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Something interesting happened 
the other day. 

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I was looking through our stats 
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subscribed and I really do 
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other 55% of you are awesome. 
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Could you please hit the 

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It'll take you one second. 

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No pay walls. 
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And the only way that we can 
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hit the subscribe button right 
now would help the show 

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tremendously. 
Thank you so much. 

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A California administrative law 
judge just ruled that Tesla 

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engage in deceptive marketing 
for Autopilot and Full Self 

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Driving. 
Now the ruling came down 

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yesterday and the judge agreed 
with the state DMV's request to 

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suspend Tesla sales and 
manufacturing licenses for 30 

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days as a penalty. 
Now the DMV has stayed the order

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and is giving Tesla 60 days to 
fix its marketing or face the 

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suspension. 
Tesla's response was immediate. 

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The company posted on X that 
sales in California will 

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continue uninterrupted. 
So what does that even mean? 

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What happens when the state's 
largest automaker refuses to 

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comply with a court ruling that 
says its product names are 

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misleading? 
The case has been winding 

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through California's Office of 
Administrative Hearings for 

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years. 
The DMV accused Tesla of making 

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customers believe that Autopilot
and Full Self Driving were 

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capable of high levels of 
autonomy, which contributed to 

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overconfidence, crashes and even
deaths. 

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Now, we're going to cover what 
the judge actually found, but 

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Tesla has to do to avoid 
suspension. 

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And while the company says it 
will not comply and what this 

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means for AI and autonomous 
vehicle markets in the future, 

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and we'll go right into that 
right after this short break. 

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You know, the California DMV 
filed accusations against 

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Tesla's manufacturing and dealer
licenses back in November of 

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2023. 
And the company pointed to 

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written marketing materials 
primarily on Tesla's website. 

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They used the terms autopilot 
and full self driving 

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capability. 
One phrase that drew particular 

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attention was this. 
The system is designed to be 

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able to conduct short and long 
distance trips with no action 

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required by the person in the 
driver's seat. 

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That statement was on Tesla's 
website. 

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The problem is that vehicles 
equipped with those features 

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could not operate as autonomous 
vehicles when that statement was

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published, and they still cannot
fully now. 

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Here's the key point to all of 
this. 

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So the judge found that the name
Autopilot follows what the 

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ruling called a long but 
unlawful tradition of 

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intentionally using ambiguity to
mislead consumers while 

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maintaining deniability. 
A reasonable person could 

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believe that a car on Autopilot 
does not require their constant 

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attention. 
That is incorrect. 

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The driver is still fully 
responsible for the vehicle at 

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all times. 
Now, on full self driving, the 

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court was much harsher. 
The judge found that this 

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feature name is, in the court's 
words, actually unambiguously 

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false and counterfactual. 
Tesla tried to argue that no 

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reasonable person could believe 
Full Self driving actually means

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full Self Driving, and then the 
court rejected that argument. 

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Tesla has since added the word 
supervised to the name of its 

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Full Self Driving software and 
now reads Full Self Driving and 

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then supervised and Tesla's 
marketing materials. 

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The DOV acknowledged that 
change, but said it does not go 

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far enough now. 
Tesla's response was very 

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defiant. 
The company issued a statement 

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through a public relations firm 
saying this was a consumer 

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protection order about the use 
of the term Autopilot in a case 

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where not one single customer 
came forward to say there was a 

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problem and the judge addresses 
it directly. 

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Though the DMV is authority to 
regulate vehicle advertising 

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does not depend on evidence that
any particular ad actually 

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deceived or harm any person, the
agency is permitted to act 

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affirmatively to prevent 
deceptive advertising actually 

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before any harm occurs. 
Now, the judge also anticipated 

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Tesla's likely non compliance. 
She wrote that without the 

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incentive of suspension, Tesla 
offers no reason for the DMV to 

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expect they will alter the 
Autopilot name or stop 

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misrepresenting his vehicle's 
driver assistance functions to 

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the public. 
Now, Suspension of Tesla's 

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licenses is a reasonable remedy 
now. 

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The DMV's original decision 
included a 30 day suspension of 

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both Tesla's sales license and 
its manufacturing licenses. 

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Now the agency softened that a 
little bit. 

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It permanently stayed the 
manufacturing suspension to 

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avoid disrupting operations at 
Tesla's Fremont factory, which 

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builds hundreds of thousands of 
cars per year, including all 

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North American Model 3 sedans. 
Now the sales license suspension

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is what remains on the table. 
California's Tesla's largest 

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market in the USA, 30 day 
shutdown of sales would have a 

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significant impact on the 
company's quarterly numbers. 

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Tesla knows this. 
The DMV knows this. 

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The leverage is part of why the 
agency gave Tesla 60 days to 

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comply rather than enforcing the
suspension immediately. 

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And Tesla has two options. 
It can change its marketing to 

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remove the term Autopilot or 
make it software actually 

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capable of autonomous driving. 
The first option is a branding 

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concession that Tesla has 
resisted for almost a decade. 

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Second option does not exist 
yet. 

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Tesla's vehicles are classified 
as Level 2 driver assist 

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systems, which means a human 
must remain engaged and ready to

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take over at all times. 
And this ruling lands at the 

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same moment that Tesla is 
advancing its robotaxi test in 

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Austin. 
The company removed safety 

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monitors from some of their cars
over the weekend from its small 

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fleet in the city. 
It had been offering rides to 

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customers with a safety monitor 
either in the driver's seat or 

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the passenger seat. 
Now those vehicles are operating

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without a human backup. 
Tesla says the Austin robo taxis

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are running a different version 
of the driving software than 

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what customers have in their 
cars. 

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That distinction matters 
legally, but it also shows how 

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Tesla is pushing forward on 
autonomy claims while 

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simultaneously fighting a ruling
that says its current claims are

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misleading. 
Now, Tesla has faced multiple 

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investigations over similar 
allegations. 

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The California Attorney General,
Department of Justice, and the 

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Securities and Exchange 
Commission have all looked into 

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whether Tesla's marketing around
partial autonomy systems was 

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misleading. 
The company has also settled 

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several personal civil lawsuits 
over crashes involving 

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Autopilot. 
This ruling is the first major 

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state level decision that could 
force Tesla to change how it 

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describes its products. 
Now, DMV Director Steve Gordon 

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said in a statement that the 
decision confirms the department

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will hold every vehicle 
manufacturer to the highest 

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safety standards. 
He added that Tesla can take 

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simple steps to pause the 
decision and permanently resolve

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the issue. 
These steps, according to 

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Gordon, are ones that autonomous
vehicle companies and other 

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automakers have already achieved
in California's marketplace. 

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Now, Tesla has 60 days to 
comply. 

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If it doesn't, the DMV will 
suspend its dealer license for 

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30 days. 
Tesla says sales will continue 

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uninterrupted, and the state 
says otherwise. 

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Now we're going to find out in 
two months which statement holds

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true. 
Hey, thank you so much for 

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listening today. 
I really do appreciate your 

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support. 
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tomorrow.