Judge upholds Tesla arbitration agreement that drivers called “unconscionable”

Enlarge / Tesla Motors store in Tokyo, Japan, on Friday, Aug. 18, 2023. (credit: Getty Images | Bloomberg)

Four Tesla drivers who sued the company over its allegedly deceptive "self-driving" claims will have to go to arbitration instead of pursuing a class action, a judge ruled.

The complaint sought class-action status on behalf of "consumers who purchased or leased a new Tesla vehicle with Tesla's ADAS [Advanced Driver Assistance Systems] technology but never received the self-driving car that Tesla promised them." Self-driving claims made by Tesla and CEO Elon Musk "have proven false time and time again," the lawsuit said.

While the plaintiffs agreed to terms including an arbitration clause when they purchased cars, they argued that "Tesla's arbitration agreement is unconscionable, and thus [un]enforceable." They said the arbitration agreement "is not referenced on the Order page" and "is buried in small font in the middle of an Order Agreement, which is only accessible through an inconspicuous hyperlink."