The lawsuit alleges that Tesla made misleading comments regarding the production status of the Model 3.
March 26, 2019
March 26, 2019—A lawsuit brought on by Tesla shareholders against the automaker was dismissed for a second time by a federal judge in San Francisco recently, Reuters reveals. The lawsuit alleges that Tesla made misleading comments regarding the production status of the Model 3.
Retuers reports that U.S. district judge Charles Breyer dismissed the lawsuit in Oct. 2017 and dismissed the original lawsuit in August, but allowed plantiffs to file an amended one.
The lawsuit alleged that shareholders purchased "artificially inflated" shares because Tesla leader Elon Musk and others misled them regarding the production of the Model 3. Additionally, the lawsuit alleges that Tesla failed to mention that it was unprepared for the vehicle's production.
Tesla argued that it had been forthcoming about production challenges for the Model 3, which included statements by Musk saying that the company was going through "production hell."
Breyer wrote that allegations of fraud ignored Tesla's "repeated warnings about Model 3 production risk," Reuters reports.
