A federal appeals court on Friday took class-action status away from a lawsuit that accuses Tesla of overstating its cars' self-driving hardware. The ruling is a win for the automaker: thousands of California buyers who paid for the Full Self-Driving package can no longer press their claims together, at least for now.
In an unpublished memorandum filed Oct. 16, a three-judge panel of the 9th U.S. Circuit Court of Appeals, Judges Ronald Gould, Jay Bybee and Daniel Bress, vacated U.S. District Judge Rita Lin's order certifying three classes in LoSavio v. Tesla and sent the case back to her court in San Francisco. The panel did not decide whether Tesla's claims were true.
What the court decided
Thomas LoSavio sued in 2022, alleging that Tesla broke California's consumer protection laws by misrepresenting its cars' hardware capabilities for the FSD packages it sold. The case turns on what the court calls the Hardware Statement: Tesla's website claim that vehicles sold from October 2016 on had the hardware needed for full self-driving, as Reuters described it. Lin certified two damages classes and an injunctive-relief class in August 2025.
Lin had compared Tesla's website to a product label, pointing to Tesla's unique marketing strategy and the central role its site played in selling FSD. The appeals court called that legally wrong. Every buyer sees a label, the panel wrote, but here, as Lin herself had found, "there [was] no specific requirement forcing [FSD purchasers] through the Autopilot page to complete their purchase."
The judges said Tesla's website-traffic data and other Tesla statements did not prove that every class member saw the claim either. The same gap sank Lin's classwide ruling on Tesla's statute-of-limitations defense, because the Autopilot page also blamed FSD delays on regulatory hurdles, and whether that kept buyers from suing depends on whether each one read it. Because the injunctive-relief class was a subset of the damages classes, the panel said it "rises and falls" with them.
What it means for FSD buyers
The case is still alive. The memorandum is not binding precedent under Ninth Circuit Rule 36-3, and the panel remanded the case for further proceedings without ruling on the plaintiff's proposed damages model. Without a certified class, though, California buyers cannot pursue their claims jointly for now, Reuters noted.
LoSavio's lawyers said the panel "did not fully appreciate the unique circumstances here," given how central the hardware statement was to Tesla's marketing, Reuters reported. Tesla, which denies the claims, did not respond to Reuters' request for comment. The U.S. Chamber of Commerce filed a brief backing Tesla, arguing that Lin's order threatened to raise the cost of overbroad class actions.
A wider fight over Tesla's self-driving claims
This is not Tesla's only dispute over how it sold driver assistance. A California administrative judge found Tesla's Autopilot and FSD marketing misleading in December 2025, and Tesla sued the state Department of Motor Vehicles in February 2026 to erase the "false advertiser" finding, EVXL reported.
The hardware question also hangs over owners of older cars. On Tesla's January 2025 earnings call, Elon Musk said the company would have to upgrade the Hardware 3 computers of buyers who had paid for FSD. In July, he said upgrading cars below Hardware 4 would make sense "at some point," without giving a timeline, according to EVXL's account of both calls. Tesla reports third-quarter results after the market closes on Wednesday, Oct. 21, followed by a live question-and-answer webcast.
