Tesla Sues California DMV to Overturn False Advertising Ruling on FSD

• Tesla's attorneys argue the DMV 'wrongfully and baselessly' labeled the company a false advertiser, claiming it was impossible to purchase or use the systems without seeing clear statements that they do not make vehicles autonomous
• Tesla now markets its system as 'Full Self-Driving (Supervised)' on a subscription basis only, but faces separate class action lawsuits from customers seeking refunds and was held partly liable for a fatal collision involving Autopilot that resulted in a $243 million verdict
• The company's future hinges on robotaxi development after EV sales declined last year; Tesla is currently testing automated vehicles in Austin and has begun production of the Cybercab, a two-seater without a steering wheel or pedals

Summary: Tesla Sues California DMV Over False Advertising Ruling

Key Development:

Tesla has filed a lawsuit against the California Department of Motor Vehicles (DMV) seeking to overturn a ruling that found the company engaged in false advertising regarding its self-driving capabilities. The suit, dated February 13, challenges the DMV's determination that Tesla violated advertising laws through its marketing of Autopilot and Full Self-Driving (FSD) features.

Background:

California's Office of Administrative Hearings ruled two months prior that Tesla falsely promoted its vehicles' autonomous capabilities. While the DMV initially had authority to suspend Tesla's manufacturing and sales licenses in the state, it instead required the company to revise its marketing language. Tesla has since rebranded its system as "Full Self-Driving (Supervised)" and now offers it only via subscription.

Tesla's Position:

Tesla's attorneys argue the DMV "wrongfully and baselessly" labeled the company a false advertiser, claiming no evidence proves California consumers were confused about the vehicles' capabilities. The company maintains that buyers received "clear and repeated statements" that the systems do not make vehicles autonomous.

Market Implications:

Tesla's future success heavily depends on delivering true autonomous driving capabilities, particularly after electric vehicle sales declined last year. The company is currently testing robotaxis in Austin, Texas, and has begun production of the Cybercab, a steering wheel-free vehicle.

Legal Context:

Tesla faces additional legal challenges, including a separate class-action lawsuit from customers seeking refunds for FSD purchases. The company was also held partly liable in a fatal Autopilot-related collision, resulting in a substantial verdict against it.