Jul 27, 2022 • 14M

🗞️ Musk's Latest Legal Shock, California Plays Hardball, & Germany's Bailout

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This Week: Tesla’s crashing into discrimination findings, California's governor goes toe-to-toe with Texas, and Germany gets into the natural gas game. Plus, 2 bed/2 bath and a reception desk, smooth ridges, and where Big Law stands on post-Roe travel benefits.

🚗 Musk Faces Round of Complaints 

The US Equal Employment Opportunity Commission (EEOC) has issued a finding against Tesla for alleged civil rights discrimination, including systemic race discrimination, hostile work environment, and pay equity claims. Tesla has denied the claims, but “will now engage in a mandatory conciliation process with the EEOC,” notes Law360. If they fail to come to a conclusion, the agency can take the suit to federal court.

  • According to a filing by the U.S. Securities and Exchange Commission, this case closely mirrors a civil complaint filed by the California Department of Fair Employment and Housing (DFEH) against the electric car company last February, which is currently awaiting a retrial after the $140M settlement was contested after being reduced to just $15M. 

  • “Tesla has said in its SEC and court filings that it believes the facts and law do not justify the damages awarded in that case and is assessing its next steps,” reports Law360.

Insult Upon Injury 

The DFEH claims that Tesla has kept its Black workers in lower-level roles and that they have been assigned to more dangerous, demanding, and dirty work in comparison to their white counterparts. Among the complaints being filed, allegations include that Tesla’s Fremont factory is, “racially segregated with white workers referring to it as ‘the slave ship’, or, ‘the plantation’ due to the way Black workers are treated.” Managers of the same factory have been accused of using racial slurs against employees who have put in formal complaints.  

The automaker's response? In addition to denying any claims against themselves, they’ve shed light on the conflict between the EEOC and DFEH that came after they both independently investigated Activision Blizzard over allegations of sexual harassment against female employees back in 2021. They contend that the DFEH is “using litigation as a bullying tactic and to advance its turf war” with the EEOC, explains Bloomberg

The Verdict? 

This certainly isn’t the first, second, or last time that Musk’s name and company have laid behind claims like these. It’ll be interesting to see how this one plays out, and what settlements are granted. May it prompt a call to action for the company to seek a better workplace environment? It’s not looking likely, as Tesla has been fast to deny any and all claims against itself, and is ready to deploy the tactic of distraction.

🎧 What We’re Listening To

This week, we’re listening to a podcast featuring our Founder and CEO, Raad Ahmed. He was recently hosted on Charlotte Smith's (Executive Coach and Founder, Level7 Legal) podcast, Limitless Lawyer, where they chatted over his journey in entrepreneurship, the Lawtrades origin story, inspiration for the future of legal work, and changing the culture in law.

Rethinking the way lawyers work, Limitless Lawyer

Apple Podcasts | Spotify | Google Podcasts  

🔁 New Gun Strategy 

California Governor Gavin Newsom took a tactic straight out of Texas's playbook. “SCOTUS is letting private citizens in Texas sue to stop abortion?!” Newsom tweeted in December. “If that's the precedent then we'll let Californians sue those who put ghost guns and assault weapons on our streets.” Well, he did just that last week when he signed SB 1327.

  • SB 1327 awards Californians $10,000 plus legal fees “to plaintiffs who successfully sue anyone who imports, distributes, manufactures or sells assault-style weapons, .50-caliber rifles, guns without serial numbers or parts that can be used to build firearms that are banned in California,” notes The New York Times

  • The bill is almost identical to Texas Senate Bill 8, which passed in 2021 and creates a bounty for citizens to enforce abortion restrictions in the state.

The Left's Aggressor

In an unusual move for a governor, Newsom has run TV ads in Florida and Texas attacking each state's governor for their right-wing policies. “I urge all of you living in Florida to join the fight, or join us in California, where we still believe in freedom — freedom of speech, freedom to choose, freedom from hate, and the freedom to love,” Newsom says in his $105,000 spot which ran on Fox News in Florida, explains the Los Angeles Times. “I think he realizes that Democrats are hungry for a hero,” Cal State Sacramento political science professor Kim Nalder told The New York Times. “He’s building a profile as an alternative on the left to this aggressive policymaking we’ve seen by Republicans in recent years.”

The Verdict

It's not clear if Newsom is eyeing a run for president (he's done so in the past, but with California AG and Senator Kamala Harris in the VP spot, a 2024 bid is questionable), however, he's definitely taking on the role as the angry Democrat channeling the frustration many in his party have with federal leadership.

📊 We’re Goin’ Viral 

And if you’re not keeping up with the pulse, you’re missing out.

Check us out

🗜️ Germany's Gas Gamble

Just 5 months into Russia's invasion of Ukraine and Putin is starting to tighten the noose on Europe's energy supplies ahead of winter. This pinch is being felt most acutely in Germany — the EU's largest economy — where 55% of natural gas supplies come from Russia. Now, as Russia has announced that it will slow the flow of gas to the country through the Nord Stream 1 pipeline beginning this week, the German government is in full crisis mode, jumping in to save one of its biggest natural gas providers, Uniper. Last Friday, German Chancellor Olaf Scholz announced that the government would purchase a 30% stake in Uniper to keep the company from financial collapse. As of just this morning, things have escalated even further, as “physical flows via Nord Stream 1 tumbled to 14.4 million kilowatt hours per hour (kWh/h) between 1200-1300 GMT from around 28 million kWh/h a day earlier, already just 40% of normal capacity,” reports Reuters.

  • “We will do everything that matters, today and for as long as necessary,” the chancellor said in a statement, which outlined the bailout plus other emergency measures aimed to prepare for the energy crisis, reports The New York Times. “We will make sure that nobody is overwhelmed in the current situation.” 

  • The purchase by the German government hurts some of Uniper's current shareholders, including Fortum, a Finnish state-owned energy company.

  • EU members have now agreed to voluntarily reduce gas use by 15% between August and March. If supplies reach crisis level, the agreement would be mandatory, notes BBC news.

A Voluntary Cut

This gas shortage will hurt the rest of Europe, not just Germany. To prepare, the EU (led by Germany) is proposing natural gas rationing and supply sharing across the continent. “We will help each other with gas supplies,” Robert Habeck, the German Economics Minister told his Czech counterparts this month during a visit to establish an agreement, says Der Spiegel. Yet, not all Europeans are keen on this plan. “Where was Europe's energy solidarity and energy security when the Germans built Nord Stream 1 against the will of Poland and many others?” Joachim Brudziński, a member of the Polish parliament, asked before adding, “in the end, it's always about German or French interests.”

The Verdict

With the clock ticking down to winter's freeze, Europe as a whole (and northern Europe especially) is bracing for the calamity that awaits it. If Chancellor Sholz and the German government can secure a series of deals around the continent to ration and transfer supplies, it'll be a massive win for unity. However, Putin is betting that he can fracture any budding alliances.

📤 What Else We're Forwarding

Home Office: Luxury developments in New York are already integrating WFH into their amenities, reports The New York Times. New projects offer residents-only office spaces in the building that look and function like other co-working spaces.

Finger Test: An Indiana man will be allowed to sit for the bar exam at the end of the month after his application was reconsidered, says Law.com. His application was initially rejected after he failed a fingerprint test “due to insufficient ridges” on his fingers, the man tweeted.

Access to Care: Above The Law has a running list of Big Law firms that will cover travel expenses for employees seeking abortions but that live in states where it is banned. While no firms say 'No', many are categorized as “unknown,” but several are a clear 'Yes'.

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See ya next week!

✌🏽 Raad