The legal team of Elon Musk is once again being pressed into action, after a fresh lawsuit was filed against the Tesla CEO and the firm itself.

According to the Guardian newspaper, Tesla shareholders are alleging they were defrauded with false claims of the self-driving capabilities of Tesla vehicles.

Last week Tesla was ordered to ‘recall’ 362,758 vehicles equipped with its experimental driver-assistance software, known as Full Self-Driving (FSD) beta, which Tesla admitted may cause crashes.

Tesla and SpaceX chief executive Elon Musk. Image credit: SpaceX

Fresh lawsuit

Tesla did this after the NHTSA found they could be unsafe around intersections. Tesla share price fell 5.7 percent upon the recall news.

Now Tesla shareholders are accusing the chief executive and his company of overstating the effectiveness and safety of Tesla’s autopilot and full self-driving technologies (FSD).

The Guardian reported that shareholders have alleged in the proposed class-action lawsuit that Tesla defrauded them over four years with false and misleading statements that concealed how its technologies – suspected as a possible cause of multiple fatal crashes – “created a serious risk of accident and injury”.

The case was filed on Monday in a San Francisco federal court.

Tesla vehicles have allegedly accounted for nearly 70 percent of reported crashes involving advanced driver-assistance systems since June 2021, according to federal figures, but officials warned against drawing any safety conclusions.

The NHTSA has opened 38 special investigations into crashes involving Tesla vehicles that have resulted in 19 deaths, looking at whether the software was a factor.

This latest lawsuit case centres on the financial fallout of Tesla’s autopilot features, citing when the company’s share price fell after reports that the National Highway Traffic Safety Administration and the Securities and Exchange Commission had begun investigating the technologies.

“As a result of defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the company’s common stock, plaintiff and other class members have suffered significant losses and damages,” the complaint alleges.

The lawsuit is led by shareholder Thomas Lamontagne, and it seeks unspecified damages for Tesla shareholders from 19 February 2019 to 17 February 2023.

Tesla’s chief financial officer Zachary Kirkhorn and his predecessor Deepak Ahuja are also defendants.

Over hyped?

Musk has aggressively hyped Tesla’s Autopilot and FSD for years now.

In late 2016 Musk reportedly promised Tesla fans a self-driving car that’s capable of driving from Los Angeles to New York without “the need for a single touch” by the end of 2017.

Then in 2019, Musk raised billions of dollars for Tesla by promising investors the company would have 1 million “robotaxi ready” cars on the road by the end of 2020.

In July 2020, Elon Musk said that Tesla was “very close” to achieving level 5 autonomous driving technology.

Level 5 is the holy grail of autonomous driving technology, as level 5 vehicles will not require human intervention, and need for a human drivers is eliminated.

Indeed, it is said that level 5 cars won’t even need to have steering wheels or acceleration/braking pedals.

These cars will be free from geofencing, and will be able to drive anywhere, and do anything that normal car with a human driver can do.

Tesla cars currently operate at a level-two, which requires the driver to remain alert and ready to act, with hands on the wheel.

Tesla has not helped matters with the naming of its self-driving systems.

California’s state transportation regulator has previously accused Tesla of false advertising since the features do not provide full autonomous vehicle control.

Tom Jowitt

Tom Jowitt is a leading British tech freelancer and long standing contributor to Silicon UK. He is also a bit of a Lord of the Rings nut...

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