close
close
migores1

Tesla and Musk beat shareholder lawsuit over self-driving promises Reuters

By Jonathan Stempel

(Reuters) – Tesla (NASDAQ: ) and its CEO Elon Musk on Monday won the dismissal of a lawsuit accusing them of defrauding shareholders by exaggerating the efficacy and safety of the automaker’s self-driving technology to boost its price actions.

U.S. District Judge Araceli Martinez-Olguin of San Francisco said the shareholders had not shown that Tesla and Musk should be guilty of falsely promising they were close to providing technology that would drive safer than people, but it was actually “fraught with safety issues” and encouraged carelessness. .

Tesla vehicles included “Autopilot” software designed to enhance self-driving capabilities, and the company sold “Full Self Driving” software upgrades.

Martinez-Olguin said some of Tesla’s and Musk’s contested statements aren’t necessarily false, while others could be excused for addressing future expectations for the technology.

She said Musk’s “hands-on” leadership did not mean he knew more than he let on, while his nearly $34 billion profit from selling Tesla stock between February 2019 and February 2023 did not show that they collect from other shareholders. expense.

Shareholders said Musk, the world’s richest person, received about $39.4 billion in proceeds from the stock sale, about the same as Vermont’s gross domestic product.

Attorneys for the shareholders did not immediately respond to requests for comment. Tesla did not immediately respond to similar requests. The judge dismissed the lawsuit without prejudice, in the sense that the shareholders can modify it.

© Reuters. FILE PHOTO: Elon Musk, CEO of SpaceX and Tesla and owner of X, formerly known as Twitter, attends the Viva Technology conference dedicated to innovation and startups at the Porte de Versailles exhibition center in Paris, France June 16, 2023. REUTERS/ Gonzalo Fuentes/File Photo

Tesla still faces investigations by the US Department of Justice and the US Securities and Exchange Commission, as well as a case from the California Department of Motor Vehicles, into its self-driving claims.

The case is Lamontagne v Tesla Inc et al, US District Court, Northern District of California, No. 23-00869.

Related Articles

Back to top button