9th Circ. Dumps Investors' Tesla Model 3 Disclosures Suit

Law360 (January 26, 2021, 5:01 PM EST) -- The Ninth Circuit said Tuesday that Tesla's blunt warnings about production challenges for its Model 3 sedan eviscerate a proposed securities fraud class action alleging the electric carmaker intentionally misled investors in 2017 by covering up manufacturing bottlenecks and capacity problems.

A three-judge panel of the appeals court tossed a bid by investors Kurt Friedman and Uppili Srinivasan to revive their second amended proposed class action alleging Tesla made reckless misstatements in 2017 about the production timeline for its highly anticipated first mass-market electric vehicle, the Model 3.

The investors claimed Tesla, CEO Elon Musk and former Chief Financial Officer Deepak...

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