A group of Tesla shareholders has filed a proposed class action lawsuit against Tesla (TSLA) and its CEO Elon Musk, alleging that the company overstated the safety and effectiveness of its Autopilot and Full Self-Driving technologies.
The lawsuit, filed in San Francisco federal court, claims that Tesla defrauded investors over four years with misleading statements that concealed the risks associated with the technologies.
According to the shareholders, these risks include the potential for accidents and injury, which have been linked to fatal crashes. The lawsuit claims that Tesla’s share price fell multiple times as a result of the truth becoming known, including after investigations were launched by the National Highway Traffic Safety Administration and the Securities and Exchange Commission.
One incident that caused a significant decline in the company’s share price was when the NHTSA ordered a recall of over 362,000 Tesla vehicles equipped with Full Self-Driving beta software, due to safety concerns around intersections. While Tesla acquiesced to the recall, it disagreed with the NHTSA’s analysis.
The complaint alleges that “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.”
This lawsuit adds to the growing scrutiny surrounding Tesla’s Autopilot and Full Self-Driving technologies, as well as the company’s handling of safety concerns. Tesla has not yet commented on the lawsuit.
It’s worth noting that while Tesla‘s Autopilot and Full Self-Driving technologies have been involved in accidents, they have also been credited with preventing accidents and saving lives. However, the effectiveness and safety of these technologies remain a topic of debate and investigation.
Overall, this lawsuit highlights the importance of transparency and honesty when it comes to emerging technologies, particularly those that have the potential to impact public safety. It also underscores the potential risks for companies and investors when such technologies are not thoroughly tested and disclosed.