Tesla is escalating its battle with California regulators, filing a lawsuit against the California Department of Motor Vehicles (DMV) in an effort to overturn a ruling that labeled the automaker a “false advertiser” over its use of the terms “Autopilot” and “Full Self-Driving.”
The legal challenge comes just days after the DMV confirmed Tesla had taken corrective action to avoid a 30-day suspension of its sales license in the state.
While that immediate threat has passed, Tesla is now seeking to formally clear its name and reverse the underlying decision by the state’s Office of Administrative Hearings, which concluded the company had violated consumer protection laws.
The dispute traces back to advertising language used between 2021 and 2022. California regulators argued that branding such as “Autopilot” and “Full Self-Driving” overstated the capabilities of Tesla’s driver-assistance systems, which require active human supervision.
At one point, the DMV sought to suspend Tesla’s manufacturing and dealer licenses in California for at least 30 days — a move that would have temporarily halted vehicle sales in the company’s largest U.S. market. Enforcement was ultimately paused, and earlier this month regulators confirmed Tesla had revised its marketing language sufficiently to remain compliant.
Tesla has since dropped “Autopilot” entirely and now markets its advanced system as “Full Self-Driving (Supervised),” emphasizing the need for driver attention.
However, Tesla’s lawsuit argues the DMV went too far in branding the company a false advertiser in the first place.
According to the complaint, first reported by CNBC, Tesla’s attorneys allege the agency “wrongfully and baselessly” applied that label. They also contend the DMV failed to demonstrate that California consumers were actually misled about the vehicles’ capabilities.
When Tesla used those brand names, the company’s attorneys argued, “It was impossible to buy a Tesla equipped with either Autopilot or Full Self-Driving Capability, or to use any of their associated features, without seeing clear and repeated statements that they do not make the vehicle autonomous.”
