Tesla has filed a lawsuit against the California Department of Motor Vehicles (DMV) in an effort to overturn an administrative ruling that found the company engaged in false advertising related to its “Autopilot” and “Full Self-Driving” driver-assistance systems.
In a complaint dated Feb. 13, Tesla argued that the DMV “wrongfully and baselessly” labeled the company a “false advertiser,” contending regulators failed to prove that consumers were misled into believing the vehicles could operate without human supervision.
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The legal action follows a long-running dispute between Tesla and the state agency. The DMV opened an investigation in 2021 amid concerns that the company’s marketing overstated the capabilities of its systems. After a five-day hearing in 2025, an administrative law judge ruled in favor of the DMV, describing the use of “Autopilot” as part of “a long but unlawful tradition” of ambiguous marketing and calling the term “Full Self-Driving” “actually, unambiguously false and counterfactual.”
Tesla was ordered to revise its marketing within 60 days or face a potential 30-day suspension of its dealer and manufacturer licenses in California, a move that could have temporarily halted vehicle sales and production in the state.
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The company subsequently complied with the requirements. By Feb. 17, the DMV confirmed that Tesla had taken corrective action, including discontinuing Autopilot as a standalone product in North America, adding a “(Supervised)” qualifier to Full Self-Driving, and shifting the feature to a subscription-only model priced at $99 per month.
Despite these changes, Tesla is seeking to remove the “false advertiser” designation from its record, a label that could affect its long-term strategy centered on autonomous driving and robotaxi services.
Tesla also argued that regulators had long been aware of its branding, noting that the Autopilot name has been used since 2014 and Full Self-Driving since 2016. The company suggested that this history undermines the DMV’s claims.
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The lawsuit comes as Tesla faces mounting legal scrutiny over its driver-assistance technology. In October 2025, the U.S. National Highway Traffic Safety Administration opened an investigation into approximately 2.88 million Tesla vehicles following dozens of incidents linked to the Full Self-Driving system, including crashes and injuries.
Separately, a federal court recently upheld a $243 million verdict in a fatal crash involving Autopilot, marking one of the most significant legal judgments against the company related to its autonomous driving claims.
