Judge gives former Tesla worker a deadline to accept $15 million payout over racism

By Jonathan Stempel

(Reuters) – A federal judge on Tuesday gave a Black former elevator operator at Tesla Inc two weeks to decide whether to accept $15 million in damages over racial abuse at the electric car company, far below the $137 million a jury had awarded.

U.S. District Judge William Orrick in San Francisco said Owen Diaz identified no controlling question of law to justify an immediate appeal of the reduced award, which includes $1.5 million of compensatory damages and $13.5 million of punitive damages.

Diaz alleged that his colleagues and a supervisor subjected him to a hostile work environment that included slurs, caricatures and swastikas in his nine months working at Tesla’s factory in Fremont, California in 2015 and 2016.

A jury had awarded Diaz $6.9 million of compensatory damages and $130 million of punitive damages last October.

Orrick reduced both on April 13, while rejecting Tesla’s bid for a new trial.

In Tuesday’s order, Orrick said he was “firmly convinced” that the jury award was excessive, and that allowing a quick appeal “would further delay resolution of a case that is already five years old.”

Lawyers for Diaz did not immediately respond to requests for comment. They had said a question of law concerning damages for emotional distress justified an immediate appeal.

Under U.S. Supreme Court precedent, punitive damages typically should be less than 10 times compensatory damages.

The case is Diaz v Tesla Inc et al, U.S. District Court, Northern District of California, No. 17-06748.

(Reporting by Jonathan Stempel in New York; Editing by David Gregorio)