Several Tesla owners have filed a lawsuit against the U.S. automaker over allegations of consumer fraud a week after a Reuters investigation found the company had exaggerated the range estimates of its EVs for years.
The proposed class action lawsuit, Porter et al v. Tesla, Inc., was filed August 2 in the U.S. District Court for the Northern District of California. Law firm Milberg Coleman Bryson Phillips Grossman is representing the Tesla owners in the lawsuit.
The lawsuit alleges Tesla violated state consumer fraud statutes when it falsely advertised the range of its electric vehicles. Lawyers representing the owners said that Tesla “grossly overvalued” the range — which is the estimated distance a vehicle can travel on a single battery charge — when selling the vehicles to consumers.
“Understanding that this would be an important feature (if not the most important feature) to many consumers, and preying on this fact, Tesla marketed its electric vehicles as having a grossly overvalued range in an effort to increase sales to consumers,” the lawsuit states.
Last week, Reuters reported that Tesla had inflated its range estimates, prompting owners to flood its service center over concerns that their vehicles needed service. The investigation, citing anonymous sources and industry experts, found that the directive to use algorithms to give rosier range numbers came from CEO Elon Musk.
As sales exploded, service requests also grew. To thwart the influx of requests and help keep costs in check, Tesla created a special “diversion team” dedicated to handle so-called “range cases” — meaning owners complaining of lower ranges than expected, according to the Reuters report. Diversion team members were trained to tell owners that the EPA-approved range estimates were just a prediction. They would also provide tips to customers on how to extend range. The team’s goal was to cancel as many of those appointments as possible, saving Tesla as much as $1,000 a visit, the Reuters investigation found.