So, Tesla Inc. (TSLA) is taking the California Department of Motor Vehicles to court. The electric vehicle giant isn't happy about being labeled a "false advertiser" for how it markets its Autopilot and Full Self-Driving (FSD) features. This comes after Tesla already removed the "Autopilot" term from its marketing in the state, but apparently, that wasn't the end of the story.
According to court filings from February 13, Tesla's lawyers are firing back. They claim the DMV "wrongfully and baselessly" slapped the false advertiser tag on the company. "The DMV Order is deeply flawed," the filing states. The core of Tesla's argument? The agency didn't actually prove that customers were confused about what Autopilot and FSD can and cannot do.
"DMV presented no consumer witnesses and instead relied almost entirely on the testimony of a single law professor," the filing says. Tesla insists it has been clear that these are driver-assistance systems—they don't make the car autonomous. You're still supposed to pay attention and keep your hands on the wheel. The company's legal team is essentially asking: where's the evidence that people didn't understand that?
It's a Legal Two-Way Street
This lawsuit is Tesla's counterpunch in an ongoing regulatory fight. The California DMV had previously sued Tesla, alleging the company misled consumers about its systems' capabilities. That lawsuit sought a pretty serious penalty: a 30-day suspension of Tesla's sales and manufacturing operations in California.
A court did rule in the DMV's favor, but the agency didn't pull the trigger on the suspension. Instead, it gave Tesla a 90-day window to clean up its marketing act. Tesla complied, avoided the shutdown, but now it's challenging the very foundation of the DMV's case.
The FSD Context: Billions of Miles and Lingering Questions
All of this is happening against the backdrop of Tesla's continued push for its Full Self-Driving technology. The company's "Supervised" FSD system, which uses cameras and AI (a "vision-only" approach) instead of the LiDAR sensors favored by many rivals, recently passed a major milestone: it has logged over 8.2 billion miles of driving.
That's a staggering number meant to demonstrate real-world use and data collection. But the technology's capabilities and safety are still under a microscope. The automaker reported five additional crashes involving its "Robotaxi" vehicles in Austin during January 2026, a reminder that the path to full autonomy is fraught with challenges.
Price Action: TSLA slid 2.91% to $399.83 at market close on Monday, and surged 0.19% to $400.57 during the overnight session.
