Tesla’s Court Victory
Tesla is no stranger to courtrooms, especially when it comes to class action lawsuits in the United States. Over the years, the company has paid millions to settle various cases, but this week brought a rare turn of events for the electric vehicle manufacturer.
Court Decision on Class Action Lawsuit
A California state judge ruled that a group of African American factory workers cannot sue Tesla as a class action plaintiff over alleged racial discrimination, giving the company temporary relief in a high-profile case that has been ongoing for several years.
What Changed in Court?
The lawsuit, originally filed by former assembly line worker Marcus Vaughn, claimed that Black employees at Tesla’s Fremont, California factory faced racial discrimination, including racist slurs directed at them and nooses hung at their workplaces.
Initially certified as a class action in 2024, the case was scheduled for trial in April 2026. However, earlier this week, California Superior Court Judge Peter Borcon stated that the 2017 lawsuit could no longer proceed as a class action, noting that many of the 200 workers randomly selected to testify at trial were unwilling to do so.
As a result, Borcon stated he could no longer trust that the experience of a smaller sample of workers could be applied to the entire class.
According to one of the plaintiffs’ attorneys, Lawrence Organ, many of those involved in the class action are low-wage workers who cannot afford to miss work and testify in the case.
Potential New Lawsuits
But Tesla is still in a difficult position. Although the class action was not certified, co-lead counsel for the plaintiffs Brian J. Schwartz states that attorneys will file hundreds of individual lawsuits. Over 500 have already been filed, and by the end, there could be more than 900 individual lawsuits alleging racial discrimination against Tesla.
Tesla has jumped out of the frying pan and into the fire with this decertification, because they are now facing hundreds of victims of race harassment seeking damages in their own suits
This decision could create significant logistical and financial challenges for Tesla, as simultaneously handling hundreds of individual cases would require substantially more resources than a single class action lawsuit. Similar precedents in labor law often lead to prolonged legal proceedings that could impact the company’s reputation and operational activities, particularly in the context of global efforts to improve diversity and inclusion in workplaces.