Tesla Whistleblower Fights to Reopen Case, Says ‘Fix Was In’ After Arbitrator Took More Tesla Work

Cristina Balan, a former Tesla engineer, is asking a San Francisco court to reopen her defamation case against Tesla, claiming the private arbitrator who ruled against her was unfairly biased in the company’s favor. Balan alleges the arbitrator, Richard McAdams, dismissed her complaint in 2021 on a technicality—that it was filed too late—after Tesla argued California’s one-year time limit applied instead of Washington state’s two-year deadline. McAdams had initially agreed Washington law applied, but later changed course and sided with Tesla.

What’s raising eyebrows is what happened after the ruling. McAdams, who had never handled a Tesla case before, was hired to oversee six more disputes involving Tesla—and one against Musk’s social media company, X—earning over $270,000 in fees. Balan calls that a “de facto kickback” and argues that his financial relationship with Tesla undermines trust in the fairness of arbitration.

Her case sheds light on Tesla’s heavy use of arbitration clauses. Employees and customers must agree to settle disputes privately before they can work for the company or buy its cars. That means most cases are handled behind closed doors, not in courtrooms. Critics say this system tends to favor corporations, especially repeat clients like Tesla that regularly use—and pay—the same arbitrators.

Balan’s legal fights with Tesla go back more than a decade. She first raised safety concerns in 2014 and says she was forced to resign after emailing Elon Musk directly. In one earlier arbitration case, she was awarded $300,000 for wrongful termination—though much less than the $5.5 million she sought. That arbitrator, a retired judge, based part of his decision on Balan’s body language during testimony.

In 2017, Tesla responded to a news article about Balan by accusing her of misconduct, including recording coworkers without permission and taking unauthorized trips—claims she says were false and defamatory. She tried to sue Tesla in court over those statements, but the case was eventually sent back to arbitration after an appeals court ruling. However, a federal judge previously allowed Balan to speak publicly about her case by striking down her confidentiality agreement—something rarely granted in arbitration disputes.

Now, Balan argues the arbitration process itself was flawed. Her lawyer says the arbitrator’s financial ties to Tesla, along with his change in applying the law, show a lack of neutrality. Legal experts say her challenge faces an uphill battle unless she can prove clear misconduct or bias, but it could lead to her case being reopened.

Balan, who is currently recovering from cancer, says she just wants to clear her name and resume her engineering career. She believes Tesla publicly attacked her reputation to send a message to other employees: don’t speak up.

Source: San Antonio Express News