Tesla FSD autopilot does not work as promised — the owner received compensation through arbitration

Despite Tesla’s efforts to promote its Full Self-Driving as a system of advanced autonomous driving capabilities, things are not going well in this direction. FSD has repeatedly led to accidents. For example, Cybertruck with FSD crashes into a poleand then Tesla car in «autonomous driving mode» drove people under a train. The arbitrator decided that the Full Self-Driving system was not worth the money and forced the company to refund the cost of this package to the car buyer. However, it was not easy to get compensation.

What’s wrong with Full Self-Driving

Tesla has been promoting the package for almost a decade Full Self-Driving. The company claims that each of its cars released since 2016 has a full set of equipment necessary for autonomous driving without human supervision. However, the reality turned out to be different. The company had to update the on-board computer several times — from HW2 and 2.5 to HW3.

But later it became clear that even this version did not deliver what was promised. In January 2025, Elon Musk officially acknowledged that HW3 would also not be able to support autonomous driving and said that the company would have to update its computers. Over the past 6 months, Tesla has not yet informed owners of the modernization plan.

Currently, Tesla is trying to fulfill its promise on the HW4 platform, which appeared in some 2023-2024 models. But even in this case, the results are still far from what was promised. Even with the latest and greatest hardware and software, Tesla only travels about 800 km between critical failures.

Compensation for FSD

Against this background, the owner Tesla Model Y In 2021, Mark Dobin from Washington, D.C., decided to seek a refund for the FSD he paid $10,000 for. He motivated the purchase by the fact that his wife has mobility problems and FSD could have provided her with greater independence. But in practice, it turned out that it was not possible to enable the function, because Tesla restricted access to the beta version by the «safety index», which was not mentioned in the contract. Moreover, the function required constant driver supervision, although it was sold as «full self-driving».

Tesla makes it difficult for customers in the United States to get a refund or sue it. In fact, under the terms of the sales contract, the company forces buyers to go through arbitration. But Dobin had a law degree and many years of experience in arbitration, so he was not afraid to go this route.

Even for a seasoned lawyer, the case took a long time to resolve. Almost a year after the application was filed, a hearing with evidence was held. It took place in Zoom.

Tesla was unable to provide convincing evidence and was not very well prepared for the hearing. The only witness from the company was a technical specialist who did not know what equipment was installed in a particular car, whether it had an FSD system, and did not review the driving logs. In addition, he did not communicate with the sales staff who dealt with this particular car and did not review the integration clause in the contract.

Tesla’s team of lawyers was larger. Both a Tesla lawyer and an external lawyer representing the company were present at the hearing. However, the witness was not ready to answer questions. Dobin even wrote that he felt sorry for the service technician, whom «Tesla had made a punching bag» with no training at all.

When Dobin asked the technician questions, he could not answer them and «was forced to defend a system that he clearly did not understand». The plaintiff focused on Tesla’s lack of disclosure regarding the safety assessment and the fact that the system did not live up to the promises made to customers.

The arbitrator then sided with Dobin and stated that the evidence was overwhelming and the «feature was not functional, operational, or otherwise unavailable to the».

As a result, Tesla was ordered to compensate the plaintiff for the cost of the FSD package in the amount of $10 thousand plus taxes. In addition, the company must pay almost $8 thousand in arbitration fees. Since Tesla forces arbitration in its contracts, it is obliged to cover the costs.

This case could set a precedent for other users who also paid for FSD but did not receive a full service. It also shows that even large tech companies are not immune from legal liability if promises are not backed up by real functionality.

Source: electrek, dobinlaw