Tesla's win in the first US trial concerning accusations that the company's Autopilot driver assistance feature caused a death was an important victory for the carmaker, while it is currently facing several other litigations and government investigations regarding the same technology.
With this verdict, Tesla has won its second big case of the year, as juries have refused to conclude that the company's software was defective. It has been rolling out its Autopilot and more sophisticated Full Self-Driving technology, which Tesla CEO Elon Musk described as essential to the company's future but has come under regulatory scrutiny.
The judge's decision in the civil case shows the increasing popularity of Tesla's claims that drivers bear the final say in accidents on the road.
The Model 3 Mah Lee was traveling at 65 miles per hour when it suddenly veered off a highway east of Los Angeles, struck a palm tree, and caught fire. The case was filed in civil court, alleging that the Autopilot feature was to blame.
According to court records, Lee was killed in the 2019 collision along with two of his passengers. One of them was an eight-year-old boy who had severe internal injuries. At the trial, graphic testimony of the injuries of the passengers was presented, and the plaintiffs requested $400 million from the jury plus punitive damages.
Lee drank alcohol prior to driving, according to Tesla, which rejected responsibility. It was unclear, according to the manufacturer of electric vehicles, if Autopilot was activated at the moment of the collision.
The 12-member jury found that the automobile was not defective when it was manufactured. The verdict was rendered by a 9-3 vote on the fourth day of the trial.
Plaintiffs' attorney Jonathan Michaels expressed dissatisfaction with the decision in a statement but added that Tesla had been pushed to its limits in the trial.
According to him, there is still some uncertainty surrounding the verdict because of the jury's protracted deliberation.
Tesla said their vehicles are well designed and can increase road safety, thinking the jury's decision was the right one.
Despite calling its system "Autopilot" and "Full Self-Driving," Tesla tells drivers that it needs human monitoring, and this tactic helped the company win a prior trial in April in Los Angeles.
In another case, the driver of a Model S was hurt when it swerved into a curb. The jury said that they thought Tesla should have warned drivers of its technology and that driver attention was the cause of the accident.
Plaintiffs claim that Autopilot is poorly built in other lawsuits, causing users to abuse the system. All that was required of the Riverside jury was to determine if the steering was affected by a manufacturing flaw.
Following a gain of over 2%, Tesla shares closed 1.76% higher.
In the Riverside trial, an advocate representing the plaintiffs provided the jury with an internal Tesla safety analysis from 2017 that listed incorrect steering commands as a problem that involves an "excessive" steering wheel angle.
The safety analysis, according to a Tesla attorney, was meant to assist the company in resolving any potential problems with the car rather than to find a flaw. The automaker later developed a mechanism that stops Autopilot from making the turn that led to the crash.
On the stand, Eloy Rubio Blanco, a Tesla engineer, denied the plaintiff's attorney's contention that the company intentionally misled consumers by calling their driver-assistance feature "Full Self-Driving" since it wanted people to think that the systems were more capable than they actually were.
The United States Department of Justice has opened a criminal investigation against Tesla for its self-driving car claims. Furthermore, the National Highway Traffic Safety Administration is looking into how well Autopilot works after finding that Tesla cars collided with stationary emergency vehicles in over a dozen crashes.
According to Sam Abuelsamid, an analyst at Guidehouse Insights, Tesla has strong legal defenses in a civil lawsuit because of its disclaimers. He believes that it will be difficult for anyone to defeat Tesla in court regarding a liability claim, and this is something that regulators need to address.