Elon Musk celebrates winning lawsuit over Tesla self-driving claims with embarrassing defense
Elon Musk is celebrating winning a lawsuit over his misleading claims regarding Tesla’s self-driving program.
However, before celebrating, he should take a closer look at the defense his lawyers took: puffery.
By definition, “puffery” refers to exaggerated or false praise. It’s also a legal defense used by defendants in cases of false advertising or misleading statements.
The defendants argue that the statements can’t be taken seriously because they were “mere puff.”
That’s precisely the defense that Tesla and Elon Musk’s lawyers have taken to defend against a shareholder’s lawsuit over Musk’s alleged misleading statements regarding Tesla’s self-driving effort.
Musk said that “justice prevails” when commenting on one of his biggest fans, Sawyer Merritt, celebrating the dismissal of the lawsuit yesterday:
However, when reporting on the dismissal, Musk and his fans didn’t examine the argument his lawyers used to defend him.
Let’s be clear on what Musk is celebrating here: he is celebrating a judge siding with his lawyers, who argued that his misleading statements regarding Tesla’s self-driving effort were simple “corporate puffery” and not “actionable material misrepresentations.”
That’s it.
The lawsuit is full of “corporate puffery” arguments by Tesla’s lawyers:
Defendants argue that the Timeline Statements that FSDC technology “appear[ed] to be on track,” would be available “aspirationally by the end of the year,” and Tesla was “aiming to release [it] this year,” [..] were nonactionable statements of corporate puffery and optimism. […] Plaintiffs contend that the statements provided a “concrete description” of the state of Tesla’s technology in a way that misled investors. […]. These statements about Tesla’s aims and aspirations to develop Tesla’s technology by the end of the year and Musk’s confidence in the development timeline are too vague for an investor to rely on them. […] Thus, in addition to being protected under the PSLRA safe harbor, Statements (10, 11, and 18) are nonactionable puffery.
In a mind-numbing statement, Musk’s lawyers argue that his claims about Tesla Autopilot safety were “vague statements of corporate optimism are not objectively verifiable”:
Defendants also assert that several Safety Statements are corporate puffery. For example, statements that safety is “paramount” (FAC ¶ 325), Tesla cars are “absurdly safe” (id.), autopilot is “superhuman” (FAC ¶ 337), and “we want to get to as close to perfection as possible” (FAC¶363). Mot. at 19. Plaintiffs respond that “super” in “superhuman” is not puffery because it represents that ADT is safer than human and “absurdly safe” conveys greater-than-human safety. Opp. at 12. However, these vague statements of corporate optimism are not objectively verifiable.
The lawyers even argued, successfully, that “no reasonable investor would rely” on many of the alleged misleading statements because they are “mere puffing”:
Defendants next argue that several Timeline and Safety Statements, (Statements 7, 9-11, 13, 16, 18, and 26 FAC 325, 329, 331, 333, 337, 343, 347, 363), are nonactionable statements of corporate puffery and optimism. Mot. at 15, 19. In the Ninth Circuit, “vague, generalized assertions of corporate optimism or statements of ‘mere puffing’ are not actionable material misrepresentations under federal securities laws” because no reasonable investor would rely on such statements.
Therefore, yes, Tesla won a dismissal, but at the cost of a judge agreeing with Musk’s lawyers that his statement about Tesla’s Full Self-Driving effort was “mere puffing.”
Electrek’s Take
Look. They are not wrong. I don’t think many reasonable investors are taking Elon’s words seriously. ‘Reasonable’ is the keyword here.
There are plenty of unreasonable ones who do, though.
I am not well-versed enough in the law to have a strong opinion on this, but you don’t need to be well-versed in the law to read the arguments of Tesla and Elon’s lawyers, who clearly state that Elon’s self-driving claims are just corporate puffing.
It’s funny that Elon is celebrating this victory. He is basically saying, ” Hey, look, I won this court case because the judge agrees that reasonable investors wouldnt believe what I say.”
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If you’re considering going electric, May will be a great time to score a deal on an EV lease. Automakers are slashing lease prices on some of the most popular EVs to move inventory – here are four standouts.
Nissan Ariya SUV
The Nissan Ariya SUV has an MSRP of $41,805. Its lease term is 36 months, with $4,409 due at signing and a mileage allowance of 10,000 a year. Monthly payment? A sweet $129!
Nissan cut the 2025 Ariya Engage’s price by $144 in April, so it now has an effective monthly cost of $251 – that’s seriously affordable for an electric SUV. If you’re already a Nissan driver, then you’re going to get an even better deal, because Nissan is offering a $1,000 loyalty discount on the Ariya, which brings its effective cost down to $224 per month.
CarsDirect, which sniffed out this deal, thinks this Ariya deal will be in place until Memorial Day, so take advantage of tariff-free pricing while you can.
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Honda Prologue SUV
The Honda Prologue SUV has an MSRP of $48,850. Its lease term is 36 months, with $1,399 due at signing and a mileage allowance of 10,000 a year. The monthly payment on the Prologue is $239.
The 2024 Honda Prologue has up to $18,800 in rebates, and the price includes a $1,000 lease loyalty discount or conquest offer. In California and other ZEV states, the EX has an effective cost of just $278 per month; in other parts of the US, pricing will be around $30 higher. This offer ends July 7.
Click here to find a local dealer that may have the Honda Prologue in stock. –trusted affiliate copy
Tesla Model 3
The Tesla Model 3 has an MSRP of $43,880. Its best lease term is 24 months, with $1,044 due at signing and a mileage allowance of 10,000 a year. The monthly payment on the Model 3 is $349.
The 2025 Tesla Model 3 still has the $7,500 federal government EV rebate. Several months ago, Tesla reduced the amount due at signing on all Model 3s. And for those who want to lease a Long Range Model 3, the effective cost can be as low as $393 per month.
You can lease the Model 3 for 36 months, but the folks at CarsDirect found that the better deal will be had on 24-month leases. They compared the Model 3’s MSRP to the 2025 Lexus IS 300 F Sport’s MSRP, which is nearly identical, and the Model 3 was around 30% cheaper to lease.
Acura ZDX
The 2024 Acura ZDX has an MSRP of $65,850. Its best lease term is 36 months, with $4,699 due at signing and a mileage allowance of 7,500 a year. The monthly payment on the ZDX is $299.
The 2024 ZDX is Acura’s cheapest vehicle to lease because it features up to $29,450 in lease cash. However, the best deal is limited to California and ZEV states. If you cash in on a loyalty discount or conquest cash, the effective cost is $430 per month. This offer runs til June 30.
Click here to find a local dealer that may have the Acura ZDX in stock. –trusted affiliate copy
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Ford (F) reported its first-quarter earnings, beating Wall Street’s revenue and EPS expectations. However, with Trump’s auto tariffs, Ford is suspending full-year guidance. Here’s a breakdown of Ford’s Q1 2025 earnings
Ford Q1 2025 earnings preview
After crosstown rival General Motors cut its full-year financial guidance last week, investors are waiting to see if Ford will follow suit.
Ford’s previous 2025 forecast called for EBIT of $7 billion to $8.5 billion and capital expenditures between $8 billion and $9 billion.
The biggest threat is Trump’s new auto tariffs, which include a 25% duty on imported vehicles and many parts. Since Ford builds a greater percentage of vehicles in the US than any other major automaker, outside of Tesla, it isn’t expected to see as big of an impact.
CEO Jim Farley called it “an opportunity for Ford,” during an interview with CNN last week, saying the company has a “different footprint, a different exposure for tariffs.”
Ford imports around 21% of the vehicles it sells in the US, while GM imports around 46%. According to Estimize, Wall St expects Ford to post Q1 EPS of $0.0 on revenue of $38.02 billion.
The company reports earnings for each of its three business units, Ford Blue (gas-powered vehicles), Model e (electric vehicles), and Ford Pro (commercial and software business).
In the fourth quarter, Ford’s EV unit (Model e) lost another $1.4 billion while Pro and Blue each reported an adjusted EBIT of $1.6 billion.
Financial breakdown
Ford beat Wall Street estimates, reporting first-quarter revenue of $40.7 billion with an adjusted EPS of 0.49.
- Q1 2025 Revenue: $40.7 billion vs $38.02 billion expected.
- Q1 2025 Adjusted EPS: $0.49 vs $0.0 expected.
The company posted adjusted EBIT of $1 billion, down 63% from Q1 2024. Ford said its first-quarter EBIT suffered a nearly $200 million hit from added tariff costs, primarily in Ford Blue and Ford Pro.
Ford Pro generated an EBIT of $1.3 billion, Ford Blue $96 million, and Ford Model e reported an EBIT loss of $849 million.
For Model e, the company is focused on improving gross margins and “exercising a disciplined approach to investments in battery facilities and next-generation products.” Although still a nearly $1 billion loss, it’s still a $500 million improvement from Q1 2024.
Ford said higher Model e revenue was driven by new EVs launching in Europe, like the electric Explorer and Capri.
The company said its “Power Promise” promotion, which includes a free home charger and several other benefits, has helped drive demand in the US.
Although it’s tracking within its previous full-year adjusted EBIT guidance of between $7 billion and $8.5 billion, Ford is suspending full-year guidance due to the uncertainty surrounding tariffs.
Ford estimates the full-year gross cost of tariffs to be around $2.5 billion. It expects a tariff-related net adverse adjusted EBIT impact of about $1.5 billion for the full year 2025.
Ford also extended its “From America, For America” campaign last week. The promo includes employee pricing on most 2024 and 2025 models and now runs through July 4.
Check back for more info from Ford’s first quarter conference call. Ford is also hosting its annual meeting on Thursday, May 8, where we should learn more about its EV plans and how it will navigate the new tariffs.
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