The screen of a Tesla Model Y during an event protesting Tesla’s full self-driving software in Austin, Texas on June 12, 2025. (Kaylee Greenlee/Bloomberg)
key takeaways:
- Tesla quietly settled a 2023 lawsuit over a fatal crash involving a Model Y using its full self-driving system in Arizona.
- The crash prompted an NHTSA investigation into whether Tesla’s camera-based technology could detect hazards during sunlight, dust or fog.
- NHTSA stepped up scrutiny this year, while Tesla said it has replaced cameras on older vehicles and continues to work with regulators.
Tesla Inc. quietly settled a lawsuit stemming from a fatal 2023 crash that led to an investigation into a malfunction in the carmaker’s self-driving technology.
The collision involved 71-year-old Johanna Story, who got out of her vehicle to help direct traffic around cars on an Arizona highway that had already crashed due to sun glare. Moments later, a Tesla Model Y SUV using the company’s so-called full self-driving system hit him at high speed.
Story’s death – one of 40,901 on American roads that year – was the first known pedestrian death linked to Tesla’s automation technology. The crash led to a federal investigation by the National Highway Traffic Safety Administration, and Story’s daughter filed a lawsuit against Tesla and the driver.
Attorney Dustin Birch, who represents Storey’s daughter, said in a phone interview that the case was recently resolved and “my client is happy to put this behind him.” Terms of the settlement were not disclosed, and a Tesla attorney did not respond to requests for comment.
Bloomberg News published an investigation last year that examined whether sun glare could compromise Tesla’s camera-based self-driving system. The report reconstructed the accident through video and photographs obtained through public-records requests.
Connected: NTSB opens investigation into fatal Tesla crash in Texas
CEO Elon Musk has bet Tesla’s future on driverless-vehicle technology and robotaxis, with the FSD underscoring those ambitions. Automakers have sought approval around the world for versions of the technology, even as some auto-safety advocates believe aspects of the system are flawed.
After launching an investigation in 2024 into whether FSDs pose an unacceptable safety risk, NHTSA this year completed the investigation through what is known as an engineering analysis. The regulator has raised concerns that Tesla’s technology could fail to detect or warn the driver under poor visibility conditions such as sunlight, dust or fog.
In the crashes reviewed by NHTSA, Tesla’s systems “did not detect normal road conditions that impair camera visibility” until just before the crash, the regulator said. A review of Tesla’s responses “found additional crashes that occurred in similar environments and where the system either did not detect the deteriorating condition, and/or it did not present an alert with sufficient time for the driver to react. In each of these crashes, FSD also lost track of a lead vehicle in its path or never detected it.”
Tesla executives said on an earnings conference call in April that the company had replaced cameras on older vehicles to address the issues. Tesla then said it would continue to work with NHTSA.
