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Elon Musk’s electric car company Tesla must face a consumer lawsuit accusing it of misleading owners into believing their vehicles could soon have self-driving capabilities, our colleague Jonathan Stempel reports. The case was led by Thomas LoSavio, a retired California lawyer who said he paid a premium for full self-driving capabilities.
The proposed nationwide class action accused Tesla and Musk of having falsely advertised since 2016 its vehicles’ Autopilot and other self-driving technology as functional or “just around the corner,” inducing drivers to pay more for their autos. U.S. District Judge Rita Lin in San Francisco said in her ruling that the complaint alleged “sufficient falsity.”
“Tesla did not recite the same lie time and time again; instead, it allegedly lied about its progress incrementally and with increasing specificity over time,” Lin wrote.
Federal prosecutors are separately examining whether Tesla committed securities fraud or wire fraud by misleading investors about its vehicles’ self-driving capabilities, according to three people familiar with the matter. Tesla and its lawyers did not immediately respond to requests for comment about Lin’s order. The next hearing in the case is on June 5.
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- Sullivan & Cromwell hired two dealmaker partners from Skadden who represented Elon Musk in his contentious, on-again-off-again $44 billion acquisition of social media platform Twitter in 2022. Mike Ringler and Peter Jones will be based in Palo Alto.
- Maryland secured approval to hire five law firms — including Kelley Drye & Warren and the Lanier Law Firm — as it explores potential litigation over the collapse of Baltimore’s Key Bridge.
- A British criminal judge who was fired for deleting WhatsApp conversations with a suspected drug dealer lost a bid to bring a legal challenge against the decision. A judge ruled at a hearing in London’s High Court that former Judge Andrew Easteal had no arguable case that his removal breached his right to a private life. He denied ever buying or taking any illegal drugs.
- Shuttered Philadelphia firm Schnader & Harrison asked a U.S. court to dismiss a lawsuit accusing it of unlawfully using pension contributions to help run the firm and pay its shareholder partners. The firm in its filing said the complaint failed to show that the contributions at issue were employee contributions. The 91-lawyer firm dissolved last year after nearly 90 years in business.
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As federal appellate courts continue to grapple with questions about where online businesses can be sued, the 9th Circuit agreed on Tuesday to revisit the dismissal on jurisdictional grounds of a California consumer class action against nationwide online payment platform Shopify. The court’s en banc review, writes Alison Frankel, will undoubtedly address an issue with potentially huge implications for online businesses: Does it make sense for courts weighing jurisdiction for suits against internet defendants to draw a distinction between cases involving physical goods and those focused on online services?
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“The defendants’ scheme calls the very integrity of the blockchain into question.“
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—Manhattan U.S. Attorney Damian Williams, announcing the arrest of two brothers who studied at the Massachusetts Institute of Technology on charges that they carried out a cutting-edge scheme to exploit the Ethereum blockchain’s integrity and steal $25 million worth of cryptocurrency. Federal prosecutors called the alleged scheme perpetrated by Anton Peraire-Bueno and James Peraire-Bueno “novel” and said the case marked the first time that such a fraud had ever been the subject of U.S. criminal charges. Authorities said that they executed their heist last year, stealing millions from traders in just 12 seconds.
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- U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California, will resume hearing evidence from Apple executives, as the court weighs a request from “Fortnite” maker Epic Games to hold Apple in contempt for allegedly failing to follow a court order requiring some changes to its lucrative App Store. Apple has denied violating the terms of the injunction, which Epic won as part of a lawsuit accusing the iPhone maker of unlawfully dominating app distribution and in-app payments. Epic mostly lost the case, and both sides appealed to the U.S. Supreme Court, which in January declined to take the case.
- U.S. District Judge Paul Engelmayer in Manhattan will hold a case management hearing in the lawsuit that Jane Street Group lodged against Millennium Management, one of the world’s largest hedge fund firms. Jane Street accused it of stealing a valuable in-house trading strategy after two traders left to join Millennium in February. Millennium and the two traders have denied Jane Street’s allegations.
- Los Angeles-based U.S. District Judge Philip Gutierrez will hold a pretrial conference in the multibillion-dollar antitrust litigation accusing the National Football League of conspiring to keep the price of its “Sunday Ticket” programming artificially high. A nationwide class of residential and commercial Sunday Ticket subscribers claiming that the NFL long has curbed competition for the sale of game telecasts is preparing for a trial in June. The NFL has denied any wrongdoing.
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Court calendars are subject to last-minute docket changes.
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- The U.S. Supreme Court restored a Louisiana electoral map that has two of the state’s six congressional districts with Black-majority populations for use in the Nov. 5 election, a ruling with potential implications for which party will control the U.S. House. The justices granted a request by state officials and a group of Black voters to temporarily halt a federal three-judge panel’s decision throwing out Louisiana’s newly redrawn map.
- A divided 4th Circuit panel rejected a bid by a group of Maryland parents to force a school district to let them opt out their elementary school children from requirements to read books with LGBTQ characters. The court ruled that the parents had not demonstrated how a county education board’s book policy would burden anyone’s rights to freely exercise religion.
- Major League Baseball, the National Hockey League and the National Basketball Association said bankrupt broadcaster Diamond Sports may not survive without a new deal with cable distributor Comcast. The sports leagues spoke up at a court hearing in Houston, telling a bankruptcy judge that they need more information about an impasse that caused Diamond’s Bally Sports-branded channels to be pulled from Comcast at the start of May.
- The California Institute of Technology and Dell told a Texas federal court that they have agreed to resolve Caltech’s allegations that Dell infringes the school’s patents covering wireless-communications technology. Caltech and Dell said they will dismiss the case with prejudice, ending a string of high-stakes Caltech patent lawsuits against tech companies over Wi-Fi chips.
- The Biden administration asked the U.S. Supreme Court not to hear an appeal by international deals broker Blenheim Capital alleging it was cut out of a multibillion-dollar transaction involving South Korea’s purchase of F-35 fighter jets and a satellite. The DOJ, which presented its views at the justices’ request, said a lower court correctly held South Korea was immune from suit.
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- Mayer Brown brought on Dario Frommer as a Los Angeles-based partner in the public policy, regulatory and government affairs practice. Frommer returns to the firm from Akin, where he led the California public law and policy practice. (Mayer Brown)
- Norton Rose added intellectual property partners Adam Rehm in Dallas and Rhiannon D’Agostin in Denver. They were previously at Polsinelli. (Norton Rose)
- Alston & Bird added New York-based litigation partner Scott Schirick. He was previously at Pryor Cashman. (Alston & Bird)
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Professional sports teams have seen a marked rise in cybersecurity threats over the past decade. A survey found that 70% of sporting organizations are hit by at least one cyberattack annually. Karen Lent, Anthony Dreyer and David Simon of Skadden explain how the industry’s multifaceted nature can create unique cybersecurity challenges and suggest best practices to help manage these evolving risks.
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