Tesla Owners' Lawsuit Shifted to Arbitration in Recent California Ruling


Four Tesla owners wanted to bring a class action lawsuit, but a judge ruled they agreed to arbitrate any legal claims when they purchased cars on the brand's website.

A California judge has diverted a class action lawsuit brought by a group of Tesla owners to individual arbitration. The Austin-based automaker is the subject of several ongoing trials and investigations over the Autopilot driver assistance feature, but this particular case will no longer be handled by the court.

U.S. District Judge Haywood Gilliam in Oakland, CA, issued the decision on Sept. 30, Reuters reported. The decision states four Tesla owners, who wanted to bring a class action lawsuit against the company, agreed to arbitrate any legal claims against it while purchasing the electric cars on the brand's website.

Gilliam also dismissed a fifth plaintiff’s claim---this owner wasn’t bound by the arbitration agreement but he apparently waited too long to sue, the report stated.

The ruling doesn’t signal an end to Tesla’s woes. The plaintiffs' lawyer, Andrew Kirtley, said he was prepared to file thousands of arbitration cases for Tesla customers. The owners are accusing Tesla of false advertising concerning its Full-Self Driving (FSD) technology, for which they paid thousands of dollars over the past few years.

FSD is an SAE Level 2+ driver assistance system, which by definition means it does not make Tesla EVs fully autonomous, contrary to what the terminology might sound like to some owners. Tesla has reiterated its driver assistance systems require full driver attention and preparedness for intervention.

There’s another Autopilot-related case against Tesla ongoing in California. The trial started the same week, and prosecutors have argued Tesla knowingly installed faulty Autopilot systems in its cars, causing the death of Model 3 owner Micah Lee and injuring two of his passengers.

Lee’s Model 3 apparently veered off the highway in California at 65 mph and struck a tree and was engulfed in flames, causing his death. The defense lawyers representing Tesla counterargued Lee was driving under the influence of alcohol and Autopilot was disengaged when the vehicle hit the tree.

We thank InsideEVs for reprint permission.

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