Amans v. Tesla, Inc.

Background

Matthew Amans and Babak Malek brought this class action against Tesla, Inc. The proposed settlement concerns people who entered contracts with Tesla for the purchase and/or installation of a Solar Roof, with or without a Powerwall energy-storage system, and whom Tesla notified in or around April 2021 that they would have to pay an increased price as a condition of performance.

The plaintiffs renewed their motion for preliminary approval of a class-action settlement. The settlement agreement proposed resolving the case and dismissing it with prejudice if the court later granted final approval. The order states that the settlement was not a finding or admission of liability by Tesla or any other party.

Preliminary approval and settlement class

The court preliminarily approved the settlement, subject to a later final-approval hearing. The court found that the settlement appeared fundamentally fair, adequate, and reasonable and was likely to satisfy Federal Rule of Civil Procedure 23(e)(2). It also found that the settlement resulted from arm’s-length negotiations between experienced class-action lawyers and provided substantial relief while avoiding the risks, costs, burdens, and delay of continued litigation, trial, or appeal.

For settlement purposes only, the court certified this class under Rule 23(b)(3): all people who entered into a contract with Tesla for the purchase and/or installation of a Solar Roof, with or without a Powerwall, in the United States, and whom Tesla notified in or around April 2021 that they would have to pay an increased price to receive performance under the contract. The court estimated the class at approximately 8,636 people and found that the class likely met Rule 23 requirements, including numerosity, common questions, typical claims, adequate representation, predominance of common questions, and superiority of the class-action procedure.

The certification was only for settlement purposes. The court confirmed Eve-Lynn Rapp as lead class counsel, Peter Muhic and Sarvenaz J. Fahimi as the plaintiffs’ steering committee, and Amans and Malek as class representatives. The court found that the attorneys were competent and that the plaintiffs would adequately protect the class’s interests.

Notice, claims, objections, and exclusion

The court approved the proposed notice in substance and found it to be the best notice practicable under the circumstances and sufficient to inform class members about the case, settlement terms, objection rights, and exclusion rights. Notice was to be sent by email and first-class mail, supported by a reminder email and a settlement website. The court appointed Angeion Group, LLC as settlement administrator.

The order required the settlement administrator to provide notice according to the settlement schedule. The notice was to be posted on the settlement website no later than 14 days after preliminary approval and mailed no later than 28 days after preliminary approval. The order also set January 2, 2024, as the deadline for objections, requests for exclusion, and claim forms.

A class member who did not timely request exclusion could object to the settlement, the proposed final judgment, the requested attorney-fee award, or the requested service award, subject to the order’s written-objection requirements. A person who properly requested exclusion would not be bound by the settlement or final judgment, would not receive a settlement payment, and could not object to the settlement.

Final-approval hearing and ruling

The court scheduled a final-approval hearing for March 7, 2024, at 1:00 p.m. Pacific time, by Zoom. The hearing was to address whether the settlement should receive final approval, whether a final judgment should be entered, and whether to approve attorney fees and service awards. The order also set deadlines for filing the fee petition and papers supporting final approval.

Judge Vince Chhabria granted the plaintiffs’ renewed motion for preliminary approval of the class-action settlement. The order preliminarily approved the settlement and settlement class, approved the notice and administration procedures, and set the matter for final approval; it did not grant final approval or decide the underlying liability issue.