Tesla and Musk sued by shareholders over autonomous vehicle safety issues
Tesla shareholders have filed a class-action lawsuit against CEO Musk and the company, accusing them of securities fraud and concealing safety risks associated with autonomous vehicles. The lawsuit was filed in federal court in Austin, claiming that Musk and Tesla exaggerated the effectiveness of their autonomous driving technology, leading to a 6.1% drop in stock prices. Shareholders are seeking compensation for losses incurred between April 19, 2023, and June 22, 2025. Prior to this, Tesla was found partially liable for a fatal accident
According to Zhitong Finance APP, Tesla (TSLA.US) shareholders have filed a class-action lawsuit, accusing CEO Elon Musk and the electric vehicle manufacturer of securities fraud, claiming they concealed safety risks associated with autonomous vehicles (including robotaxi).
The lawsuit was filed on Monday in federal court in Austin, following Tesla's first public test of robotaxi in Austin at the end of June, which revealed issues such as speeding, sudden braking, entering the wrong lane, and making dangerous maneuvers.
This testing led to a 6.1% drop in Tesla's stock price over two trading days, resulting in a market value loss of $68 billion.
Shareholders claim that Musk and Tesla repeatedly exaggerated the effectiveness and development prospects of their autonomous driving technology, thereby inflating the financial expectations and stock price of the electric vehicle manufacturer.
This includes Musk's assurance on April 22 that Tesla "will focus on introducing robotaxi to Austin in June," as well as Tesla's statement on the same day that its autonomous driving approach would achieve "scalable and safe deployment across regions and use cases."
The lawsuit, led by Tesla shareholder Dennis Morland, names Tesla, Musk, Chief Financial Officer Vaibhav Taneja, and former Chief Financial Officer Zachary Kirkhorn as defendants, seeking compensation for shareholder losses incurred between April 19, 2023, and June 22, 2025.
Prior to this lawsuit, a Florida jury ruled that Tesla was 33% responsible for a fatal accident involving its autonomous driving software in 2019, awarding $243 million to the victims.
As of the time of publication, Tesla's pre-market stock was down 0.19%
