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Tesla May Have A Serious New Legal Problem

Lawsuit / 14 Comments

These Model S and Model X owners are rightly angry.

Just as it seemed like Tesla had finally worked out all of its internal production issues, specifically involving the Model 3, the EV automaker is now finding itself facing some legal hurdles. Aside from the US government’s own investigation regarding Model 3 safety claims, a private owner filed a lawsuit in Northern California last week against the company claiming the driving range of older vehicles was shortened following software updates intended to fix defective batteries. What Tesla should have done was issue a recall to repair the batteries, but the lawsuit, which seeks class-action status, claims Tesla avoided doing so because of the high costs involved.

According to Reuters, class-action status is being sought because there are potentially "thousands” of affected Model S and Model X owners around the world whose older-generation batteries no longer provide sufficient range.

In some cases, the range has dropped by as much as 40 miles. Apparently, this has been a hot topic of conversation amongst Tesla owners on the widely read TeslaMotorsClub.com forum. Users have gone into detail about depleted battery range despite the fact some even purchased more expensive trim levels specifically for the extended range. They claim, however, this feature was eliminated following a software update which not only affected range but also vehicle value. The plaintiff in question has a 2014 Model S 85 that has lost battery capacity equivalent to about 8 kWh. Tesla told the owner this was normal, but how is depleted power and range "normal’?

In response, Tesla stated that "A very small percentage of owners of older Model S and Model X vehicles may have noticed a small reduction in range when charging to a maximum state of charge following a software update designed to improve battery longevity.”

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Therefore, it was working on the problem and has since "been rolling out over-the-air updates to address this issue since last week.” What’s interesting is that this specific problem first received attention back in May when a Model S caught on fire in Hong Kong. As a result, Tesla decided to revise the charge and thermal management settings on the Model S and Model X via an over-the-air update. Unfortunately, this seems to have also negatively impacted older vehicles for the aforementioned reason.

"Under the guise of ‘safety’ and increasing the ‘longevity’ of the batteries of the Class Vehicles, Tesla fraudulently manipulated its software with the intent to avoid its duties and legal obligations to customers to fix, repair, or replace the batteries of the Class Vehicles, all of which Tesla knew were defective, yet failed to inform its customers of the defects,” the lawsuit states.

Can Tesla remedy the situation by issuing yet another over-the-air update, or is the problem far more labor-intensive, specifically to replace the batteries? The court will decide soon whether this lawsuit will advance to the next level.