Tesla Faces Legal Battle Over Full Self-Driving Feature Advertising

A judge has ruled that Tesla must face a lawsuit alleging false advertising of its Full Self-Driving feature, allowing negligence and fraud-based claims to proceed.

Tesla is no stranger to lawsuits, and a recent ruling by a district judge has added another to the list concerning its Full Self-Driving (FSD) feature. According to a report by Reuters, U.S. District Judge Rita Lin in San Francisco denied Tesla’s request to dismiss a lawsuit accusing the company of «false advertising» and misleading customers into believing fully autonomous cars were imminent.

Previously, Judge Haywood Gilliam denied a motion for a preliminary injunction, instructing plaintiffs to address their complaints individually. However, Thomas LoSavio was permitted to amend his complaint, leading to Judge Lin’s recent decision allowing the lawsuit to proceed. Whether this will become a class-action lawsuit is yet to be determined, according to Bloomberg.

Judge Lin stated that the complainants could pursue negligence and fraud-based claims, citing their belief in Tesla’s promises about the vehicles’ future autonomous capabilities.

LoSavio purchased a Tesla Model S in 2017, adding the Full Self-Driving option for $8,000. Despite Tesla halving the monthly subscription fee and releasing improved software versions, the company has yet to achieve an autonomous car beyond the SAE Level 2+ designation.

«Every year after LoSavio’s purchase, Musk allegedly repeated that Tesla’s cars were getting closer to full automation and that ’next year’—every ’next’ year—the cars would drive themselves. As LoSavio noted during the hearing, these were not mere recitations. With each iteration, Musk’s statements became more specific,» Judge Lin remarked.

Tesla’s Full Self-Driving and Autopilot systems have faced multiple challenges. The National Highway Traffic Safety Administration (NHTSA) is investigating whether recent fixes addressed prior safety issues. Additionally, the Justice Department announced earlier this month that it is investigating whether Tesla and Elon Musk exaggerated the capabilities of these features to customers and investors, potentially committing wire fraud and/or securities fraud.