Tesla Faces Federal 'Open Investigation' Over Racism Allegations: What You Should Know

Tesla Inc TSLA is facing an “open investigation” by a U.S. federal agency, Bloomberg News reported on Monday, citing the EV maker’s state court filing in Oakland.

What Happened: Elon Musk-led Tesla linked the investigation by the U.S. Equal Employment Opportunity Commission (EEOC) to a “turf war” with California’s state Department of Fair Employment and Housing (DFEH). 

Austin, Texas-based Tesla in its filing accused DFEH of seeking a ‘quick publicity grab’ and asked a judge to pause a lawsuit filed in February by the agency over ignoring “rampant racism” in its factory in Fremont.

Tesla claims DFEH is exceeding its legal authority and “uses litigation as a bullying tactic and to advance its turf war” with the EEOC, as per the report.

“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,” the report noted, citing the filing.

An email sent to Tesla seeking comments remained unanswered outside of business hours.

See Also: Tesla Will Have To Pay Just One-Ninth Of The $137M Claim In Racism Lawsuit

Why It Matters: DFEH in its lawsuit claims Tesla has 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.

The agency has in the recent past been involved in high-profile complaints and lawsuits against companies such as Walt Disney Co DIS, Cisco Systems Inc CSCO, and others. 

Price Action: Tesla stock closed 1.9% higher at $1,004.3 a share on Monday.

Photo courtesy: Tesla