A California judge officially ruled that Tesla has engaged in “deceptive marketing” regarding its self-driving software. The verdict is a staggering blow to the brand. Tesla’s license to manufacture and sell cars in the state is to be revoked for 30 days. However, the California DMV is granting the automaker a 60-day grace period to fix its marketing strategy before the suspension hammer actually drops.
Since 2016, Tesla has been moving units by selling Level 2 driver assistance software under the ambitious banner of Full Self-Driving (FSD). The court found this name to be “unequivocally false and counterfactual”. In a moment of unintentional comedy during the proceedings, Tesla’s legal team reportedly argued that “no reasonable person” could actually believe that Full Self-Driving meant, well, full self-driving. The judge wasn’t buying it.
The court also took aim at the term Autopilot. While not deemed “unambiguously false”, the judge noted it follows a shady tradition of using intentional ambiguity to mislead consumers while maintaining “plausible deniability”. Essentially, a reasonable driver might assume a car with “Autopilot” doesn’t require their undivided attention. A dangerous assumption given that Tesla drivers remain fully responsible for the vehicle at all times.
Despite Tesla’s recent attempts to rebrand the tech as Full Self-Driving (Supervised) the court ruled that the company must go further to clarify its cars aren’t actually autonomous. If Tesla fails to scrub its marketing of misleading claims within 60 days, the DMV could freeze operations at its Fremont factory, where 20,000 employees churn out half a million cars annually. Tesla has called the move “draconian”, but the court maintains it’s the only way to stop the misinformation loop.
While Tesla insists sales will continue without interruption, this ruling provides major ammunition for a separate class action lawsuit in California. It turns out that when you tell the public your car can handle a cross-country trip with “no action required” from the driver, the law eventually expects you to mean it.
