The lawsuit, filed by the California Civil Rights Law Group, said while Lambert worked at the Oakmont plant between the summer of 2015 and the spring of 2016 he was subjected to "continuous" abuse.
"They would call him the N-word throughout his workday, talk about the size of his penis and even placed a drill gun into his buttocks," an accompanying press release said late Monday.
The release also claimed that in October 2015 a video camera on Lambert's phone caught violent threats being made against him which repeatedly used the N-word and threatened to "cut you up in pieces".
Lambert himself described working at the plant as a "dream job that turned into a nightmare."
The complaint alleges that Tesla failed to properly investigate the issue or subsequently take action to protect Lambert.
Tesla, in a statement released Tuesday, rejected the accusation that it did not properly investigate the series of incidents.
The California Civil Rights Law Group said Tesla is therefore now liable for damages to the employee.