Lawsuit Regarding Tesla's "Autopilot" System

On December 30, 2016, owners of vehicles manufactured by Tesla Motors, Inc. filed a class action alleging that the up-and-coming automotive giant has designed and manufactured defective automobiles.[1] The plaintiffs claim that Tesla Model S and Model X vehicles fail to perform as safely as a reasonable consumer would have the right to expect for two reasons. First, the vehicles have a heightened risk of Sudden Unexpected Acceleration (“SUA”), meaning that they could autonomously accelerate at full power even when the driver is pressing the accelerator pedal only lightly or, in some cases, not at all.[2] Second, the plaintiffs claim that the vehicles’ safety systems are defectively designed because they lack autonomous, fail-safe collision prevention systems that activate in possible SUA events.

Due to the increasingly sophisticated autonomous capabilities of Tesla vehicles, the aggrieved Tesla owners contend that the automobiles must be designed with similarly-sophisticated and effective autonomous safety technologies. Model S and Model X vehicles are equipped with cutting-edge technologies that allow them to detect and respond to objects in their environment. These vehicles can control their own steering, speed, braking, lane changing, and parking. Tesla plans to continue developing and distributing the company’s self-driving technologies and intends for its vehicles to be capable of fully autonomous cross-country travel in just two years.[3] Because a reasonable consumer would expect vehicle safety systems to keep up with the progress of self-driving technologies, autonomous-capable vehicles designed without sophisticated collision-prevention technologies are unreasonably dangerous.

Tesla responded to the allegations in the class action by arguing that it has no legal duty to design and install the failsafe technology the plaintiffs demand.[4] The company alleges claims each alleged SUA incident was caused by the human driver, and requiring an automobile manufacturer to develop safety technology that would prevent collision due to human error would be unprecedented and unreasonable.

The common law binds courts to rule in a manner that is consistent with prior precedent, but the pace of technological change impacts society in such a substantial manner that courts sometimes have no choice but to expand upon established legal doctrines. Technological advances can change consumer expectations drastically.[5] As we discuss in a moment, the way that changing technology shapes our expectations is particularly relevant to product liability claims because reasonable consumer expectations are a component of the legal standard for these types of cases.

In the United States, product liability laws have allowed aggrieved customers to recover damages from designers and manufacturers of defective products since 1916.[6] Since this time, three distinct theories of product liability have emerged: negligence, strict liability, and breach of warranty.

Plaintiffs in all product liability cases must prove as a preliminary matter that the product involved in the case is defective in its design, manufacture, or marketing. Product design is defective when the item is unreasonably dangerous even when manufactured properly due to its improper design, such as an electric saw engineered without a blade cover. The item may be functional, but its design makes it unreasonably dangerous. Manufacture defect occurs when an item is constructed improperly and as a result functions in an unreasonably dangerous fashion. Returning to the example of the electric saw, a manufacture defect could be present if the tool was designed with a blade cover, but the cover was attached improperly during assembly and tended to fly off at high speeds during use. Defects in marketing occur when the producer fails to warn consumers about latent dangers associated with the use of a product, such as the risk of bodily injury associated with using power tools. [7]

After establishing defect, product liability plaintiffs must show that the defendant either acted negligently, had breached a warranty, or should be subject to strict liability. A defendant can be liable for negligence when five criteria are met: (1) the defendant has a legal duty of care to the plaintiff, (2) the defendant acts without reasonable care, (3) this action actually causes physical harm, (4) the harm was reasonably foreseeable, and (5) the plaintiff suffers actual damages as a result.[8] Plaintiffs bringing products liability claims based upon negligence will only prevail if they are able to prove all five criteria – if they are unable to produce sufficient evidence for even one element, their suit will fail.

Most jurisdictions have adopted a strict liability approach to product liability to avoid the potential unfairness and unnecessary complexity of a negligence claim. Under strict liability, a defendant is liable for damages if the plaintiff can demonstrate that he or she was injured because of a product defect. Unlike negligence claims, in which a plaintiff must show that the defendant owed a duty of care to him or her specifically, a plaintiff in a strict product liability case can prevail by proving only that a product was defective, this defect caused the plaintiff injury, and this injury gave rise to legal damages.

In addition to negligence and strict product liability, plaintiffs can pursue claims for breach of express or implied warranty. When a product does not conform to some promise or representation made by its producer or marketer regarding some important characteristic, the defendant beached an express warranty. Liability for defective products may also arise from the producer’s breach of an implied warranty, which is a quality standard imposed upon business by law. Two implied warranties are typically relevant to product liability: the “implied warranty of merchantability” and the “implied warranty of fitness for a particular purpose.” The implied warranty of merchantability guarantees that a product is fit for the ordinary purposes for which it is typically used.[9] By comparison, the implied warranty of fitness for a particular purpose arises when the seller of a product knows or has reason to know the particular purposes for which a customer intends to use it and the customer relies on the seller’s expertise in determining whether its intended use is suitable.[10] For example, if a customer asked a trusted fabric store owner for fire-proof curtains, the store owner selects a fabric for the customer based upon this request, and the curtains catch fire regardless, the store owner has breached the warranty of fitness for a particular purpose.

With the preceding in mind, let’s return to the product liability claims currently pending against Tesla Motors, Inc.. The claimants allege that the Model S and Model X are defective for two reasons: first, they are prone to SUA, and second, they lack failsafe technology that would remove all risk of full-throttle acceleration into non-moving objects, even when caused by the human driver. [11] The plaintiffs allege these defects make the vehicles unreasonably dangerous and altogether amount to a negligent breach of the duty of care that Tesla owes its customers and the general public. Alternatively, the plaintiffs claim that they should be entitled to recover damages on the basis that Tesla is strictly liable for the harm their defective vehicles caused, and further that the company breached both expressed and implied warranties regarding the safety of its vehicles.

Tesla is not the only major automaker to be the subject of a product liability lawsuit alleging Sudden Unintended Acceleration. In 2010, a class action was filed against Toyota Motor Corporation because some of its vehicles were designed in a defective manner and as a result prone to SUA.[12] Although Toyota settled the suit without an admission of liability, the automaker was required to pay a total of $280 million to driver-education charities and affected Toyota customers and to install a brake-override system in defective vehicles.[13] Like the Tesla plaintiffs, plaintiffs in the Toyota case argued that the vehicle producer designed a defective product because it did not include technologies that would prevent SUA.[14] Toyota cured this defect with the installation of a failsafe system that cuts power to the car’s throttle when the accelerator and brake pedals are pressed at the same time. The Tesla plaintiffs also demand a system like the one installed following the Toyota settlement, but they go even further to demand the installation of technology that automatically stops the vehicle when it autonomously detects fixed objects in its immediate path.[15] In other words, they are demanding Tesla design a car incapable of colliding head-on with a non-moving object.

The Tesla SUA legal controversy begs the question of whether autonomous vehicle technology will force a change in the legal standards governing automotive product liability law. Failsafe systems in autonomous vehicles may seem reasonable, but requiring an automaker to design a car that automatically prevents collisions would be a substantial departure from current industry standards. Evolving technology changes our expectations, and our notions of vehicle safety may shift from a question of how well our cars protect us in an accident to how well our cars can automatically avoid the accident in the first place.