Tesla won a federal appeals ruling on Friday, October 16, that strips, for now, class status from thousands of California buyers suing over their cars’ Full Self-Driving hardware. A three-judge panel of the 9th U.S. Circuit Court of Appeals vacated U.S. District Judge Rita Lin’s August 2025 order certifying all three classes, a decision EVXL covered when it came down.

The case itself survives. The lawsuit, brought by lead plaintiff Thomas LoSavio in 2022, alleges Tesla misled buyers about that hardware and now goes back to Lin’s court in San Francisco.

The panel did not decide whether Tesla’s hardware claim was true. Its ruling turns on the page of Tesla’s website where that claim appeared.

The 9th Circuit Ruled Tesla’s Hardware Claim Was Optional Reading

Tesla’s website said vehicles sold since October 2016 had the hardware needed for full self-driving capability. The 9th Circuit held that Lin was wrong to infer every FSD buyer saw that statement, because it sat on the Autopilot page and nothing forced buyers through that page to complete a purchase.

The panel, Circuit Judges Ronald Gould, Jay Bybee and Daniel Bress, heard argument on August 31 and built that point on Lin’s own finding, which they quoted: there was “no specific requirement forcing [FSD purchasers] through the Autopilot page to complete their purchase.” In the panel’s unpublished memorandum, that meant presuming classwide exposure required assuming that buyers reached the page and that they were exposed to the claim there. The judges allowed that the claim’s prominence on the page might support the second assumption, but said the first one rules out a classwide inference. Lin had compared Tesla’s website to a product label. The judges said a label is different because every buyer has it in front of them.

Tesla’s website-traffic data did not rescue the classes either. The panel also set aside other Tesla statements repeating the same message, because they were never handed to every buyer and did not amount to the kind of extensive, long-term advertising campaign that lets a court presume exposure.

The same gap sank Lin’s finding that the buyers’ answers to Tesla’s statute-of-limitations defense could be decided classwide. The Autopilot page attributed FSD delays to regulatory hurdles, and whether that kept a buyer from suing depends on whether that buyer saw it. With the two damages classes gone, the injunctive-relief class built from them fell too. Under Ninth Circuit Rule 36-3, the unpublished memorandum is not precedent.

The U.S. Chamber Backed Tesla’s Appeal, and the Plaintiffs Dispute the Ruling

The U.S. Chamber of Commerce filed a brief supporting Tesla and urged the 9th Circuit to strike the class certification orders, Reuters reported. The business group argued that Lin’s ruling threatened to substantially increase the costs of “overbroad and meritless class proceedings.”

LoSavio’s lawyers said in a statement, “we think the panel did not fully appreciate the unique circumstances here,” pointing to how central the hardware statement was to Tesla’s marketing. Tesla denies the claims and did not immediately respond to Reuters.

Tesla is also fighting a separate California case over its FSD marketing. In December 2025, a state administrative judge found its Autopilot and FSD marketing misleading, and Tesla sued the California DMV in February to erase the “false advertiser” finding.

EVXL’s Take

I think the panel held Tesla’s website to a standard built for product labels, which is not how Tesla sold FSD. Lin inferred classwide exposure partly because Tesla sold directly, without independent dealers or mass advertising, so buyers relied on its website and Musk’s public statements. That made the Autopilot page the closest thing Tesla had to a label, and the panel now treats it as optional reading for people who paid thousands of dollars for FSD.

The claim on that page has also aged badly. On the January 29, 2025 earnings call, Musk said “we’re gonna have to upgrade people’s HW3 computer for those that have bought FSD.” On the Q2 2026 call in July, he said upgrading cars below Hardware 4 would make sense at some point, and Electrek’s report on the call cites no timeline. Hardware 3 cars get a separate FSD v14 Lite build, which reached South Korea in July. The case now goes back to Lin with that claim still untested, and the California FSD buyers have to keep fighting without a certified class.

Sources: 9th Circuit memorandum, LoSavio v. Tesla, No. 25-7927, Reuters, Drive Tesla Canada, Electrek

EVXL uses automated tools to support research and source retrieval. All reporting and editorial perspectives are by Haye Kesteloo.