Tesla (NASDAQ:TSLA) shareholders have filed a proposed class-action lawsuit accusing Elon Musk and the electric vehicle maker of securities fraud for allegedly concealing safety risks tied to its self-driving vehicles, including the robotaxi.
Filed Monday in Austin federal court, the lawsuit follows Tesla’s first public test of its robotaxis in Austin late June that showed the cars speeding, braking suddenly, entering the wrong lane, and making dangerous maneuvers, such as dropping passengers in the middle of busy roads.
The test sparked a 6.1% drop in Tesla’s stock over two trading days after it began, wiping out $68 billion in market value.
Shareholders claim Musk and Tesla repeatedly overstated the effectiveness of and prospects for their autonomous driving technology, inflating the electric vehicle maker’s financial prospects and stock price.
This includes Musk’s April 22 assurance that Tesla was “laser-focused on bringing robotaxi to Austin in June,” and Tesla’s statement the same day that its approach to autonomous driving would deliver “scalable and safe deployment across diverse geographies and use cases.”
Led by Tesla shareholder Denise Morand, the lawsuit names Tesla, Musk, CFO Vaibhav Taneja, and former CFO Zachary Kirkhorn as defendants, and seeks damages for shareholders from April 19, 2023 to June 22, 2025.
The suit follows a Florida jury verdict that held Tesla partly 33% liable for a fatal 2019 crash involving its self-driving software, awarding $243 million in damages to victims.
TSLA shares were marginally up premarket on Wednesday.