Tesla Investor Sues Musk, Board Over Accusation of Workplace Discrimination

Reuters
By Reuters
June 18, 2022Business News
share
Tesla Investor Sues Musk, Board Over Accusation of Workplace Discrimination
Elon Musk arrives for the 2022 Met Gala at the Metropolitan Museum of Art, in New York on May 2, 2022. (Angela Weiss/AFP via Getty Images)

A Tesla Inc. shareholder sued the electric car maker, Chief Executive Elon Musk, and its board, accusing them of neglecting to tackle complaints about workplace discrimination and harassment, and engendering a “toxic workplace culture.”

Thursday’s lawsuit is the latest against Tesla, which has been accused of racial discrimination and sexual harassment in its factories.

“Tesla has created a toxic workplace culture grounded in racist and sexist abuse and discrimination against its own employees,” the investor, Solomon Chau, said.

“This toxic work environment has gestated internally for years, and only recently has the truth about Tesla’s culture emerged,” he added in the complaint.

“Tesla’s toxic workplace culture has caused financial harm and irreparable damage to the company’s reputation.”

Tesla did not immediately respond to an email seeking comment outside regular U.S. business hours.

Kendall Law Group PLLC, the lawyers representing Chau, were not available outside regular U.S. business hours.

Tesla has said it does not tolerate discrimination and has taken steps to tackle workers’ complaints.

The lawsuit accuses the defendants—Musk, 11 Tesla board members, and the company—of having breached their fiduciary duty by failing to address and remedy the red flags concerning internal reports of discrimination and harassment.

This caused Tesla to lose high-quality employees and incur costs for defending cases and settling fines for violations, the lawsuit said.

The case is Chau et al v. Musk et al, US District Court, Western District of Texas (Austin), 1:22-cv-00592.

By Sayantani Ghosh, Kevin Krolicki, and Abinaya V

ntd newsletter icon
Sign up for NTD Daily
What you need to know, summarized in one email.
Stay informed with accurate news you can trust.
By registering for the newsletter, you agree to the Privacy Policy.
Comments