Tesla Inc (NASDAQ:TSLA) and its CEO Elon Musk were sued by shareholders who accused the electric vehicle maker of securities fraud for allegedly concealing safety risks associated with its self-driving vehicles, including the recently tested Robotaxi.
The proposed class action, filed late Monday in federal court in Austin, Texas, claims Tesla misled investors by overstating the capabilities of its autonomous driving technology and failing to disclose operational flaws that could compromise safety and violate traffic laws.
The complaint alleges a “significant risk” that the Robotaxi could operate dangerously or violate traffic laws.
Tesla’s Robotaxi test in Austin on June 22 drew sharp criticism after videos circulated showing the vehicles exceeding speed limits, driving in the wrong lane, abruptly braking, and dropping off passengers in the middle of multilane roads.
Tesla shares dropped 6.1% over the two trading sessions following the test, on June 24 and 25, as investors reacted to the reports and the NHTSA’s response, the lawsuit said.
The suit, which seeks unspecified damages on behalf of investors who bought Tesla stock between April 19, 2023, and June 22, 2025, also references a recent Florida jury verdict that found Tesla liable in a fatal crash involving its Autopilot system. On August 1, a jury awarded $329 million in total damages, including $242.5 million in punitive and compensatory damages, to the victims of that crash.
In addition to Musk and Tesla, former CFO Zachary Kirkhorn and current CFO Vaibhav Taneja were also named as defendants in the complaint.