Tesla Motors Inc (TSLA) Settles the Lemon Law Suit in Wisconsin


Tesla Motors Inc. (NASDAQ:TSLA) is a pioneer in design, manufacture and sales of electric cars and electric vehicle power train components. Model S Sedan was considered to be one of the pioneering efforts from Tesla and also was present at Smithsonian Museum with the display of history’s most revolutionary automobiles.

One such model was bought by Wisconsin based doctor, which he claimed was a ‘lemon’. He claimed that the car was in the shop for 66 days during the first few months of purchase. Attorney Vince Megna, filed a lemon lawsuit against Tesla Motors Inc. (NASDAQ:TSLA) on the behalf of the owner. Tesla officials initially denied the claims, but in a latest turn around they have agreed to pay $126,836 to cover car’s cost and lawsuit expenses.

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Megna’s first interview with Fox Business was back in April. First ever Lemon lawsuit was filed at that time against Tesla Motors Inc. (NASDAQ:TSLA) by him. Recently Megna reappeared in Fox Business studio and talked about what happened in the last 68 days.

He said that Tesla Motors Inc. (NASDAQ:TSLA) did not accepted that their car was a Lemon, but their actions suggested that it was, in fact, a Lemon. He pointed out that according to Wisconsin Lemon law, the car which was claimed as a Lemon will be declared as one. This declaration, however, will not apply to the entire Model S fleet from Tesla, but just to one particular model.

Tesla Motors Inc. (NASDAQ:TSLA) had announced that the case is closed. But question still remains if this lawsuit files was just an isolated case.

“It’s not just an isolated case, there are other claims. What’s important about this case is we did not sign a confidentiality agreement. That’s why I am able to talk to you about it. That’s why I was able to make a settlement video,” he said.

The owner of that Model S Car received tax rebate of $7500 and the question arises that if that will have to be repaid to the federal government.

He thinks that $7500 was just a tax credit given to owner and government will not take it back. He said that it is not tax payer’s money or rebate but just the federal tax credit that his client got in the year that he bought the car. He thinks that the credit is to encourage people buying the electric cars. Involving the performance risk with these electric cars, government wanted to promotes its sales and hence the credit is given to people who opt to take that risk.

Disclosure: None