Tesla settles lawsuit over fatal crash involving Full Self-Driving
What's the story
Tesla has settled a lawsuit related to a deadly 2023 crash involving its Full Self-Driving (FSD) system. The case was filed by Johna Story's daughter after the 71-year-old woman was hit by a Tesla Model Y while directing traffic around an earlier accident caused by sun glare. The terms of the settlement have not been disclosed publicly.
Probe details
NHTSA investigation into FSD
The National Highway Traffic Safety Administration (NHTSA) launched an investigation into Tesla's FSD system in 2024. The probe was prompted by four crashes in low visibility conditions, including the one involving story. At the time, NHTSA said it was looking into whether the driver assistance system could "detect and respond appropriately to reduced roadway visibility conditions," like sun glare or fog.
Investigation upgrade
Engineering analysis of the FSD probe remains open
In March 2026, the NHTSA escalated its investigation into an engineering analysis. The agency's report raised concerns that Tesla's degradation detection system, both in its original and updated forms, fails to detect and/or warn drivers appropriately under degraded visibility conditions like glare or airborne obscurants. This upgraded investigation remains open despite the settlement of the family's lawsuit against Tesla.
Software investigation
Separate investigation into FSD software
Along with the probe into the FSD system, the NHTSA also launched an investigation into Tesla's FSD software in October 2025. The federal agency was looking into reports that the software had caused vehicles to run red lights or veer into oncoming traffic. These probes are separate from the lawsuit settlement and could result in further action against Tesla, including a possible recall of its vehicles.