Elon and the terrible, horrible, no good, very bad legal week

Workers allege discrimination, missing payments

To say Elon Musk's business empire is having a week of legal woe may be an understatement, after filings revealed yesterday suggest his social network X and electric car outfit Tesla both face potentially expensive court battles.

Documents filed in two cases against X in Delaware – one [PDF] by a group of six former Twitter staffers and another [PDF] by a class of laid off employees who say X owes them $500 million in unpaid severance benefits – indicate the cases could soon go to trial.

Both cases are being heard by Judge Jennifer Hall of the US District Court for Delaware and were put on hold in December pending settlement negotiations. According to documents filed by lawyers for both sides, those efforts have failed and none of the parties want an extension to continue negotiating.

Instead, X's lawyers are asking the judge to reconsider motions for dismissal in both cases. If the judge denies those motions, the cases will move to discovery, and then on to trial.

This is not the only case in which former Twitter employees have claimed Musk did not pay promised settlements after widespread layoffs. A similar case was filed in California shortly before the Delaware class action and alleges a $500 million severance shortfall. Other cases alleging improper layoffs at Twitter involved the ex-bird violating WARN Act requirements and layoff discrimination.

Then-Twitter was also reportedly trying to push disgruntled former employees into arbitration talks instead of court. Employees have since accused Twitter of delaying those arbitration talks.

X has also been sued by consultants and contractors alleging it never paid them, and by executives who allege the company refused to reimburse legal expenses incurred as a result of employment at Twitter.

Meanwhile, at Tesla's discrimination suit-plagued Fremont factory

Tesla's Fremont assembly plant has a long history of discrimination and harassment complaints, and now it's facing one from nearly 6,000 employees.

Cases accusing Tesla's Fremont employees of discrimination against Black employees are nothing new. Former Fremont employee DeWitt Lambert sued Tesla for discrimination at the plant, as did former contractor Owen Diaz. The US Equal Opportunity Employment Commission even filed a lawsuit against Tesla for racist behavior at the Fremont plant, alleging last year that such behavior was "frequent, ongoing … and occurred across all shifts, departments and positions."

This week's developments involve yet another discrimination lawsuit.

Filed in California's Alameda County Superior Court 2017 by lead plaintiff Marcus Vaughn, Tesla already tried and failed to push the case into arbitration, and now Judge Noël Wise has decided the case can proceed as a class action. Included in the lawsuit are any Fremont employees who've worked at the factory since 2016 and self-identify as Black, of which there are reportedly 5,977.

Wise reportedly said that the matters in question in the lawsuit are common to all Black workers at the plant and could lead to millions in penalties if Tesla is found guilty of the charges. The car maker has described the case as a "hotbed of misinformation" and insists it is "absolutely against any form of discrimination, harassment, or unfair treatment of any kind."

The legal record begs to differ, especially given Diaz won his lawsuit.

Neither Tesla nor X responded to questions for this story. ®

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