Tesla has agreed to pay $1.5 million to over 1,700 Model S owners and lessees to settle a proposed class action claiming a software update intended to reduce the risk of battery fires also reduces the range of the vehicles.
Most of the 1,743 owners and lessees who make up the class will receive $625, with some receiving a prorated amount, said named plaintiff David Rasmussen in a motion for preliminary approval of the deal.
The plaintiff’s attorneys will seek up to $410,000 in fees and expenses from the settlement fund, according to the filing.
Rasmussen filed the suit in 2019, claiming that Tesla had pushed out the software update after reports of car batteries igniting and causing fires. Tesla said the update was a precaution to protect the batteries, but the update reduced the batteries’ charging abilities and cut their range by 20 to 40 miles.
The update imposed “and then restored” the batteries’ maximum voltage. The deal pertains to anyone in the U.S. who owned or leased a Tesla Model S vehicle between May 2019 and September 2020 that experienced a limitation of maximum battery voltage as a result of Tesla’s May 2019 software update.
The proposed settlement follows discovery on the scope of the maximum voltage limitation in the affected vehicles, mediation and months of negotiations. Should the deal garner court approval, all settlement class members would get a notice via mail.
In his August 2019 complaint, Rasmussen alleged that he personally saw a significant drop-off in the car’s range, down from 247 miles on a full charge to as low as 217 after the software update. He said he was denied a replacement battery under warranty.
Despite acting in the guise of “safety,” Rasmussen said at the time that Tesla must be held accountable for effectively reducing the usability and value of its cars after they were in customer hands. The company’s ability to alter the cars after sale is an unfair business practice and violates state and federal consumer protection laws.