Federal judge denies Tesla's retrial request in case involving worker's claims of racism at factory in Fremont, California

The worker was initially awarded $137 million over the allegations, but a new trial has been set to determine the amount Tesla will have to pay.

• A federal judge denied Tesla's request for a retrial over the verdict of a case involving a former worker's claims of racism. 
• Last year, a jury determined that Tesla owed Owen Diaz $137 million over allegations of racism at its Fremont factory.
• The new trial date has been set to redetermine how much Tesla will be required to pay Diaz.

A judge denied Tesla's request for a retrial on Wednesday in a lawsuit brought against the electric-car maker, alleging racial discrimination at its factory in Fremont, California. 

US District Judge William H. Orrick halted Tesla's efforts to potentially overturn the racism verdict during a 20-minute motion hearing on Wednesday. Bloomberg was the first to report the judge's decision.

Last year, a jury awarded former Tesla elevator operator Owen Diaz $137 million in his lawsuit against Tesla. Judge Orrick cut the award down to $15 million earlier this year, calling the award "unconstitutionally large."

Diaz refused the lower amount and a new trial has been set to determine how much Tesla will have to pay Diaz in damages. The new trial date is set for March 27, 2023, court filings show. Tesla had originally argued that the amount should be lowered to $600,000.

Diaz's lawyer and a Tesla spokesperson did not respond to Insider's request for comment ahead of publication.

Last year, Diaz's award was believed to be the largest for a racial discrimination lawsuit in history after the jury agreed that Tesla had created a hostile working environment for Diaz, who worked at the carmaker's Fremont factory between 2015 and 2016.

Diaz alleged that Tesla ignored instances of racism at the factory, including claims his coworkers and direct supervisor verbally abused him and that racist graffiti was written on the bathroom walls. 

Diaz was among the first of many Tesla workers at the Fremont factory to file a lawsuit against the company. Since, dozens of workers have alleged racial discrimination and sexual harassment at Tesla. Helen Rella, a New York labor lawyer, previously told Insider that a landmark case like Diaz's could "open the floodgates" to a slew of lawsuits for Tesla.

A California civil rights regulator also sued Tesla last year, alleging it had received "hundreds of complaints from workers" following a three-year investigation.

At the time, Tesla called the lawsuit an attack against "the last remaining automobile manufacturer in California," and said that it "always disciplined and terminated employees who engage in misconduct, including those who use racial slurs or harass others in different ways." The carmaker countersued the agency in September.