Tesla Likely Must Face California Agency's Race Bias Lawsuit

A California state judge on Wednesday said he would likely deny Tesla Inc's bid to dismiss a lawsuit by the state's civil rights agency accusing the electric car maker of widespread race discrimination at an assembly plant.

California Superior Court Judge Evelio Grillo in Oakland in a tentative written order rejected Tesla's claims that the lawsuit would be unmanageable because it involves thousands of employees, and that the state Civil Rights Department (CRD) failed to notify the company of all the claims before it sued in February.

During a hearing on Wednesday, Grillo said he needed more time to issue a final decision, according to a representative of Tesla.

California judges often issue tentative written rulings before court hearings. It was not clear when Grillo could issue a final decision.

In the lawsuit filed in February, the CRD said Tesla's flagship Fremont, California, plant was a racially segregated workplace where Black employees were harassed and discriminated against in terms of job assignments, discipline and pay.

Tesla, which has denied wrongdoing, and its lawyers said they had no immediate comment.

A spokesperson for the CRD declined to comment. The agency until last month was called the Department of Fair Employment and Housing.

Austin, Texas-based Tesla is facing a series of race and sex discrimination cases, most involving the Fremont plant. A state judge in April cut a jury verdict for a Black worker who alleged racial harassment from $137 million to $15 million. The plaintiff rejected the reduced award and opted for a new trial, which is scheduled for March 2023.

In its motion to dismiss the CRD's case, Tesla says the agency flouted its obligations under state law by filing the lawsuit without first notifying the company of all of the claims or giving it a chance to settle.

Tesla in June filed a complaint with a different state agency, the California Office of Administrative Law, claiming the CRD's alleged lapses are widespread and the procedures adopted by the agency are unlawful. The OAL earlier this month declined to review Tesla's petition without giving a reason for doing so.