Tesla calls California factory racism suit abuse of power

Tesla Inc. blasted California’s lawsuit accusing the company of ignoring “rampant racism” in its factory, saying the state agency has “abandoned its founding purpose” to make sensational headlines.

Monday’s filing by the world’s largest electric-vehicle maker asks a judge to pause a lawsuit filed in February by the state’s Department of Fair Employment and Housing. The agency alleged that Tesla turned a blind eye to years of complaints about racial slurs on the assembly line at its plant in Fremont, California, where 20,000 people work.

“DFEH conducted a bare bones ‘investigation’ without interviewing key witnesses, requesting key documents, or ever stepping foot in the Fremont facility,” Tesla said in the filing in state court in Oakland.

The agency has been roiled by controversy of late. Its assistant chief counsel recently resigned to protest what she said was the abrupt firing of her boss by California Governor Gavin Newsom. The lawyer accused Newsom of interfering with the agency’s discrimination lawsuit against Activision Blizzard Inc. -- a claim Newsom’s office said is “categorically false.” 

DFEH representatives didn’t immediately respond to a request for comment.

The civil rights enforcement agency in recent years has filed high-profile complaints against companies including Walt Disney Co., Cisco Systems Inc. and Riot Games Inc. 

Tesla faced a number of a lawsuits over its treatment of Black employees -- including one that led to a $137 million jury verdict against the company -- before the agency lodged its own complaint.

The automaker claims DFEH is exceeding its legal authority and “uses litigation as a bullying tactic and to advance its turf war” with the U.S. Equal Employment Opportunity Commission that spilled into public view in the Activision case.

Tesla disclosed in Monday’s filing that the EEOC had an “open investigation” into the company before DFEH filed its complaint.  

“DFEH ignored its statutory obligations and rushed to file suit against Tesla, perhaps for a quick publicity grab, perhaps out of fear that the EEOC would be the first to settle with Tesla,” Tesla’s lawyers said in the filing.

EEOC representatives didn’t immediately respond to a request for comment.

Tesla also said the California agency quoted heavily in its lawsuit from administrative complaints filed in recent months by a private attorney, Bryan Schwartz, alleging race discrimination on behalf of former Tesla employees. But DFEH didn’t even show these complaints to Tesla until after the agency filed its February suit, according to the company.

Schwartz said Tesla’s attempt to halt the DFEH case is more of the same “scorched earth litigation technique” the company resorts to when it’s accused of wrongdoing.

“They haven’t really changed their approach, which is blame the lawyers, blame the plaintiffs, but don’t do anything about the egregious racism at their plant,” he said.