Tesla Consumer Fraud Class Action Alleges Flawed Safety Features and Autopilot Software

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Santa Clara, CA: Tesla is facing a consumer fraud class action lawsuit over allegations the luxury car maker knowingly sold 2016-2017 models that have inoperative standard safety features. The suit also claims that the enhanced autopilot software is faulty, yet customers were charged a premium to have it included in their vehicles.

Filed by three Tesla customers in Colorado, Florida and New Jersey, the suit states that nearly 50,000 Model S and X Tesla vehicles sold in 2016 and 2017 are affected by the defects. The plaintiffs claim that Tesla assured them that the standard safety features and its premium enhanced autopilot software would be rolled out in a December 2016 software update. However, Tesla missed its deadline and failed to deliver software that is stable, thereby deceiving customers.

“Contrary to what Tesla represented to them, buyers of affected vehicles have become beta testers of half-baked software that renders Tesla vehicles dangerous if engaged,” the complaint states.

According to the suit, despite claims made on the Tesla website, stating the Model S is “designed from the ground up to be the safest, most exhilarating sedan on the road” and that it has autopilot capabilities “designed to make your highway driving not only safer, but stress free,” such statements don't live up to reality.

Further, the suit states that while consumers paid an additional $5,000 for models with enhanced autopilot software allegedly to be rolled out in December, Tesla missed its own deadline. When the software was revealed, consumers found that it “causes vehicles to behave erratically” and is “essentially unusable and demonstrably dangerous. ”

Had the consumers known such promised safety features would not be part of their vehicles or that the autopilot function would be inoperable as represented, they would not have purchased or leased their vehicles at all, much less paid an additional $5,000 for the autopilot function, the suit contends.

“Tesla had to know how deeply flawed, raw and untested the software was and remains,” the lawsuit states.

The three named plaintiffs are Tesla buyers who paid between $81,200 to $113,200 for their vehicles, all of which include the additional $5,000 for enhanced autopilot. Colorado plaintiff Dean Sheikh contends the premium feature on his 2016 Model S 60 D “remains nonfunctioning.” Florida plaintiff John Kelner and New Jersey plaintiff Tom Milone each say autopilot on their 2016 Model S 90 D “remains nonfunctioning or unsafe to use” and that only a front collision warning feature has been enabled.

The lawsuit seeks to represent a Colorado class, Florida class and New Jersey class, plus enhanced autopilot subclasses for each of those states.

The suit alleges violations of the consumer fraud statutes in each of those three states plus fraud by concealment and unjust enrichment.

The plaintiffs in the instant case are represented by Shana E. Scarlett, Steve W. Berman, Thomas E. Loeser and Robert F. Lopez of Hagens Berman Sobol Shapiro LLP. The case is Dean Sheikh et al. v. Tesla Inc., case number 5:17-cv-02193 in the U.S. District Court for the Northern District of California.

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