Monday, October 27, 2025

Tesla, Musk Sued by Shareholders Over Robotaxi Safety Claims

Tesla (Nasdaq: TSLA) and CEO Elon Musk were sued by shareholders Monday, accused of securities fraud for allegedly concealing safety risks tied to the company’s self-driving vehicles, including its robotaxi service.

The federal lawsuit stems from troubling incidents during Tesla’s June robotaxi debut in Austin, where autonomous vehicles were caught on video making dangerous maneuvers and traffic violations. Tesla’s stock dropped 6.1% over two trading days after the problematic footage was released.

The complaint accuses Tesla of inflating claims about its self-driving technology while concealing from investors the “significant risk” that the vehicles posed safety hazards and could break traffic laws. The lawsuit seeks unspecified damages for investors who purchased Tesla stock between April 19, 2023, and June 22, 2025.

Read: Tesla Executives Knew Robotaxi Claims Were Overstated, Documents Show

The legal action comes as Tesla faces mounting scrutiny over its self-driving claims. A Florida jury ordered the company to pay $243 million in damages Friday after finding Tesla partially liable for a fatal 2019 Autopilot crash.

Videos from Tesla’s Austin robotaxi launch showed cars entering opposing traffic lanes, stopping abruptly near police vehicles, and exceeding speed limits. The National Highway Traffic Safety Administration contacted Tesla about the incidents after they were documented on social media.

“Tesla’s lies turned our roads into test tracks for their fundamentally flawed technology,” said Brett Schreiber, lead attorney for the plaintiffs in the Florida case.

Tesla defended its technology and said it plans to appeal the Florida verdict. “Today’s verdict is wrong and only works to set back automotive safety,” the company said in a statement about the Autopilot case.



Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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