Investor of Tesla Inc. accused employees and directors of the electric vehicle manufacturer in a lawsuit of allowing a “toxic workplace culture” to emerge in the company.
CEO Elon Musk and others who run the world’s largest electric vehicle maker have breached their trust by fostering an environment of discrimination and harassment, exposing Tesla to potential responsibility for millions of dollars, according to a complaint filed Thursday. by shareholder Solomon Chow in federal court in Austin, Texas.
“This toxic work environment has originated internally for years and only recently has the truth about Tesla’s culture emerged, leading to legal action by both government regulators and individuals,” Chau said in the complaint. “Tesla’s toxic workplace culture has caused financial damage and irreparable damage to the company’s reputation.”
Tesla is fighting a lawsuit from the California Department of Fair Employment and Housing for racial discrimination and harassment after the agency discovered a widespread pattern of harassment of black workers at an electric car maker’s factory near San Francisco. The company also faces complaints from several employees that sexual harassment has spread to the Fremont factory.
Tesla did not immediately respond to a request for comment. A blog post in February said DFEH’s complaint was “wrong”.
Musk “either knew, was reckless, or was grossly negligent in neglecting illegal activities of such magnitude and duration,” Chau said in his complaint.
Chau blamed the company’s board for defeating shareholders’ proposals aimed at tackling Tesla’s workplace problems.
Shareholder activists have so far failed to get Tesla’s board to adopt more transparency on the use of arbitration to resolve complaints of sexual harassment and racial discrimination.
The case is Chau v. Musk, 1: 22-cv-00592, U.S. District Court, West Texas (Austin).