Tesla, the electric vehicle maker, is no stranger to legal disputes, with its CEO Elon Musk often at the center of the controversies. However, the latest lawsuit against the company centers on a growing concern among Tesla owners regarding parts and repairs. We will delve into Tesla’s legal woes, including the most recent lawsuit and the ongoing legal battles the company has been fighting.
Tesla’s Latest Lawsuit
A Tesla Model S owner is seeking class-action status in a federal court in San Francisco, alleging that she had to pay exorbitant repair costs and face long wait times for service.
The plaintiff claims that Tesla has monopolized the parts and service aspects of its business. Tesla owners can only get their cars serviced at Tesla service centers or authorized service shops, and Tesla vehicles can only be repaired using Tesla parts.
Owners of other vehicles can go to any service shops and use genuine or third-party parts to repair their cars. The plaintiff alleges that Tesla owners have to pay more for service and parts and have suffered long wait periods for service availability and/or parts.
Other Legal Woes for Tesla
While the latest lawsuit against Tesla concerns parts and repairs, the company has been embroiled in other legal disputes. One of the most significant lawsuits Tesla has faced was in 2018. A group of Tesla shareholders alleged that Musk and certain company board members were liable for trading losses caused by Musk’s “funding secured” Twitter posts about taking the company private.
Musk maintained that his tweets were truthful and meant to ensure all investors had equal information before the news leak made it public. A jury eventually sided with Musk and Tesla and found both not liable for fraud from that tweet.
In another lawsuit, a group of shareholders sued Elon Musk and Tesla’s board over what they thought was an outrageous pay package offered to Musk back in 2018. The plaintiffs asserted that Musk’s compensation of around $56 billion was not deserved and not an effective motivation tool.
Plaintiffs alleged that Tesla’s board did not give shareholders enough information about the pay package. They also claim it was essentially rubber-stamped by Tesla’s board, who were all handpicked by Musk. The plaintiffs also alleged that the board did not effectively monitor him. Musk eventually went off and bought Twitter and seemed to be spending more time there than Tesla. A ruling, in this case, is still pending following closing arguments in February.
Finally, in late February, a proposed class action lawsuit was filed in federal court in San Francisco, alleging that Tesla and Musk deceived shareholders over the safety and effectiveness of its autonomous driving software, specifically its Autopilot and FSD (full-self-driving) features.
The plaintiffs allege that Tesla defrauded them for four years over false and misleading statements about the autonomous software, concealing that it “created a serious risk of accident and injury” and knew the software didn’t operate as it had stated. The National Highway Traffic Safety Administration (NHTSA) and the Department of Justice are investigating Tesla over its autonomous driving software.
Tesla was forced to recall more than 362,000 vehicles due to defects in the software by a Tesla-issued OTA (over the air) update.
Legal disputes are not uncommon in the automotive industry. However, Tesla gets itself embroiled in one legal dispute after another, usually concerning the behavior of CEO Elon Musk.
With the latest lawsuit focusing on parts and repairs, it remains to be seen how the company will respond and whether it will face any legal repercussions.
As for the other lawsuits, the outcome is still pending, and it remains to be seen how these cases will affect the future of Tesla.