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Elon Musk’s Tesla Faces Reckoning Over Misleading Self-Driving Claims

— June 6, 2024

A new nationwide class action alleges Telsa falsely advertised the status of its driver assistance systems, duping drivers.

In a stunning blow to Elon Musk’s electric car empire, a U.S. judge has rejected Tesla’s attempt to dismiss a class-action lawsuit accusing the company of deceiving its customers about the capabilities of its self-driving technology. This landmark decision paves the way for a legal showdown that could have far-reaching implications for the future of autonomous driving.

At the heart of the matter is the accusation that since 2016, Tesla has been systematically misleading its customers about the functionality and readiness of its Autopilot and Full Self-Driving features.

The proposed nationwide class action, led by retired California lawyer Thomas LoSavio, alleges that the company has falsely advertised these advanced driver assistance systems as being either “functional or just around the corner,” effectively duping drivers into paying hefty premiums for technologies that remain elusive.

LoSavio himself is a prime example of the alleged deception. In 2017, he shelled out an additional $8,000 for the Full Self-Driving capabilities on his Tesla Model S, believing that it would enhance his driving safety as he aged. Six years later, he is still waiting for the promised technology, with Tesla remaining “unable even remotely” to deliver a fully autonomous vehicle.

Elon Musk's Tesla Faces Reckoning Over Misleading Self-Driving Claims
Photo by Craig Adderley from Pexels

In her ruling, U.S. District Judge Rita Lin in San Francisco acknowledged the merits of the case, stating that the owners can pursue negligence and fraud-based claims to the extent that they relied on Tesla’s representations about the hardware and capabilities of their vehicles.

While the judge stopped short of rendering a final verdict, she mentioned that if Tesla had indeed conveyed to customers that its hardware was sufficient to enable high or fully autonomous driving, then the plaintiffs (the Tesla owners suing the company) have provided enough evidence to suggest that these claims were false. Yet, some of the other allegations brought forward in the lawsuit were dismissed.

This decision represents a significant blow to Tesla’s carefully crafted public image, which has long been built on the promise of revolutionary self-driving technology.

Neither Tesla nor its legal team provided any immediate response when contacted for comment on the judge’s decision. Similarly, the lawyers representing the Tesla vehicle owners involved in the case also declined to comment on the ruling at that time.

The company has repeatedly touted Autopilot and Full Self-Driving as game-changing features, asserting that they allow vehicles to steer, accelerate, and brake within their lanes, as well as obey traffic signals and change lanes.

However, Tesla has also acknowledged that neither of these systems truly makes its vehicles autonomous, and that drivers are still required to remain attentive and in control at all times. This apparent disconnect between the company’s marketing claims and the reality of its technology has now come under intense scrutiny, with the class-action lawsuit seeking unspecified damages for all Tesla owners who have purchased or leased vehicles with these self-driving features since 2016.

The legal battle has only intensified in recent months, as federal prosecutors are reportedly examining whether Tesla committed securities fraud or wire fraud by misleading investors about the self-driving capabilities of its vehicles. This parallel investigation further underscores the growing concern over the company’s transparency and the potential consequences of its bold assertions.


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