The U.S. Department of Justice (DOJ) has thrown its support behind Tesla in a circuit court appeal against Louisiana’s ban on direct automotive sales. Tesla filed a lawsuit last year against Louisiana automotive dealer groups, seeking to overturn the ban on direct sales without using a dealership. In June, U.S. District Judge Sarah Vance ruled against Tesla in the case. Now, the DOJ has filed a document echoing Tesla’s argument, claiming that Judge Vance misinterpreted antitrust law in dismissing the case.
Tesla immediately appealed the decision, and the DOJ filing aligns with Tesla’s argument, stating that Judge Vance wrongly required the automaker to prove that the Louisiana dealer groups intended to suppress competition. The DOJ asserts that such a requirement would improperly restrict the reach of antitrust law. However, the DOJ clarifies that it does not support Tesla or the opponents in the case and does not have an opinion on the appeal’s outcome.
Vance’s ruling stated that the ban applied to all vehicle manufacturers and that Tesla had not presented evidence of anti-Tesla bias from the Louisiana Legislature. In response, Tesla argues in its appeal that Louisiana car dealerships conspired to harass Tesla with baseless investigations and force it out of the state.
No date has been set for the appeal in the appeals court, and this is one of several direct sales bans that Tesla faces at the state level across the U.S. In Connecticut, Tesla partnered with Mohegan Sun, a casino operated by the Mohegan tribal nation, to bypass the direct sales ban and establish a showroom. Other states, including Mississippi and Florida, are also proposing similar bans that would require residents to leave the state to purchase vehicles or have them serviced by Tesla and other online-purchase model automakers.
Tesla reached a settlement in a comparable case in Michigan in 2020, with the state agreeing that Michigan residents can lawfully purchase and service Teslas in the state.
What are your thoughts? Let me know at [email protected], find me on X at @zacharyvisconti, or send your tips to us at [email protected].
