A U.S. judge has declined to throw out a lawsuit accusing Tesla of discriminating against American citizens in its hiring practices in order to pay lower wages to foreign workers.
At the same time, the judge signaled doubts about the strength of the case, indicating he is skeptical that the software engineer who filed the lawsuit will ultimately succeed.
Vince Chhabria, a U.S. District Judge in San Francisco, said in a brief order late Monday that Scott Taub, who filed the proposed class action in September 2025, had presented “just enough facts” about Tesla’s hiring practices to allow the case to proceed.
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Taub alleges that the electric carmaker, led by billionaire Elon Musk, passed him over for an engineering role as part of what he describes as a “systematic preference” for hiring foreign visa holders, in violation of federal civil rights law. He further claims that recent layoffs at Tesla have disproportionately affected U.S. citizens.
On Monday, Judge Chhabria said Tesla will also have to answer Taub’s allegation that a recruiter working with a staffing firm told him the engineering position he applied for was “H-1B only,” a reference to the H-1B visa program used to hire highly skilled foreign workers and widely relied upon across the tech industry.
The judge, however, dismissed the claims brought by a second plaintiff, human resources specialist Sofia Brander. He said it was not plausible, based on the current complaint, that Tesla favors foreign workers for HR roles. Still, he gave Brander two weeks to file an amended complaint with additional details to support her allegations.
Tesla has denied the allegations, calling them “preposterous” in court filings.
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President Donald Trump, a Republican, has imposed a $100,000 fee on new H-1B visas, describing the move as a way to discourage companies from misusing the program and replacing American workers. The fee is now facing legal challenges in at least three separate lawsuits.
The lawsuit argues that Tesla relies heavily on H-1B visa holders. It points to 2024, when the company is estimated to have hired about 1,355 visa holders while cutting more than 6,000 jobs in the United States, most of them believed to be held by American citizens.
Judge Chhabria said Monday that aside from the recruiter’s alleged remark, Taub has offered limited evidence to support his discrimination claims. The 2024 figures, he noted, show that Tesla hired a significant number of H-1B workers that year, but they do not by themselves prove the company favoured them over U.S. citizens.