The right to repair landscape is constantly changing. In March, the final form of the New York Digital Fair Repair Act (“NY DFRA”) was signed and approved, which will require that original equipment manufacturers (“OEMs”) of digital electronic equipment make available tools, parts, and documentation to independent repair shops and individuals. In June, the Massachusetts Attorney General will begin enforcing an expanded version of Massachusetts’s right to repair legislation for motor vehicles, which requires that OEMs make available the same service information and tools for vehicles to independent repair shops and individuals, including telematics data. Now, two class action lawsuits filed in California against Tesla allege that Tesla’s sale, servicing, and repair of electric vehicles (“EVs”) is unlawful due to Tesla’s market power.
All of these developments highlight a nationwide shift to require OEMs manufacturing products that depend on digital and electronic components to change how they provide diagnostic information, equipment, tools, and replacement parts in their relevant markets.
Current Right to Repair Legislation and its Applicability
The NY DFRA in its current and final form was signed and approved by Governor Hochul on March 3, 2023. It requires that OEMs of digital electronic equipment make tools, replacement parts, and documentation for any hardware product manufactured for the first time, and first sold or used in New York available to independent repair shops and individuals. Under the DFRA, “digital electronic equipment” expressly excludes products and services that are used for motor vehicles and related equipment or those that are manufactured by motor vehicle manufacturers. Thus, even though Tesla EVs have so many digital electronic components that they may be considered computers on wheels, the NY DFRA does not apply because of its express exceptions.
While the NY DFRA does not apply to EVs like those manufactured by Tesla, Massachusetts right to repair legislation does apply. In 2013, Massachusetts passed its Motor Vehicle Owners’ Right to Repair Act, which required that OEMs make the same service information and tools for vehicles available to independent repair shops and individuals as provided to authorized repair shops and franchised dealers. In 2014, major vehicle OEMs chose to comply with Massachusetts’s legislation across the country and signed a memorandum of understanding to voluntarily adopt the Massachusetts law nationwide. Then, in 2020, Massachusetts voters overwhelmingly approved a ballot initiative to expand the Massachusetts law to provide vehicle owners and independent repair shops with access to telematics, which is the data that is transmitted wirelessly from vehicles to manufacturers, such as automatic airbag deployment and crash notification, remote diagnostics, navigation and GPS, and emergency and vehicle location information.
As soon as the voters approved the ballot initiative, the automotive industry sued, with support from the National Highway Safety Administration, on the basis that telematics systems contain sensitive intellectual property and proprietary information. The Massachusetts Attorney General argued that federal regulations do not preempt a validly adopted ballot initiative, and vowed to enforce the expanded Massachusetts law beginning in June 2023.
Once enforced, the expanded Massachusetts law can be expected to apply to all EVs sold in Massachusetts. Tesla and other EV OEMs would be required to provide a standardized open data platform beginning with 2022 model year vehicles to EV owners and independent repair shops to access and retrieve mechanical data and run diagnostics through a mobile-based application. Although it is unclear whether major vehicle OEMs – including Tesla – will voluntarily agree to comply with the expanded Massachusetts law across the country as they did in the 2014 memorandum of understanding, the issue of expanding statutory rights for automobile-related digital repair rights is an increasingly important one.
Tesla Class Action Lawsuits
Companies that have express statutory exemptions cannot assume that they do not need to worry about digital repair rights. In Lambrix v. Tesla, Inc. and Orendain v. Tesla, Inc., a class of Tesla owners filed actions in the Northern District of California in March 2023, alleging violations of the Sherman Antitrust Act and the Magnuson-Moss Warranty Act.
The first four claims for relief allege violations of Section 2 of the Sherman Act, which prohibits the monopolization of any part of trade or commerce between US states. The plaintiffs allege that Tesla has monopoly power in the EV, Tesla Repair Services, and Tesla-Compatible Parts markets, because it controls prices and excludes competition. These four claims allege that Tesla willfully and intentionally engages in predatory, exclusionary, and anticompetitive conduct to unlawfully maintain its monopoly in these markets and that Tesla’s conduct presents a dangerous probability of achieving a monopoly in these markets because Tesla warranties and policies discourage Tesla owners from obtaining repair services through any service provider other than Tesla.
The fifth claim was brought under Section 1 of the Sherman Act, which prohibits unlawful tying arrangements where a seller conditions the sale of a good or service in a market in which that seller has market power. The complaint alleges that Tesla leverages its market power in three distinct markets, Tesla EVs, Tesla Repair Services, and Tesla-Compatible Parts, to coerce Tesla EV owners into purchasing Tesla Repair Services and Tesla-Compatible Parts only from Tesla. This conduct then causes Tesla EV owners to pay supracompetitive prices, experience shortages and long wait times, and be generally deprived of competitive benefits from the option of servicing, repairing, and maintaining their EVs themselves or through independent repair shops.
The sixth claim for relief alleges violations of Section 102(c) of the Magnuson-Moss Warranty Act, which prohibits tying arrangements that condition coverage for warranties on consumers’ use of an article or service identified by a brand, trade, or corporate name, unless provided for free. Related Section 700.10 of the Code of Federal Regulations provides that no warrantor may condition the validity of a warranty on the use of only authorized repair service providers or authorized replacement parts for non-warranty service and maintenance. The complaint alleges that Tesla requires that all services be performed by and all parts be purchased from Tesla, and Tesla threatens to void warranty coverage if purchased from another seller. Further, Tesla’s parts warranties only extend coverage if parts are purchased directly from and installed by Tesla itself, preventing Tesla EV owners from having their EVs serviced by independent repair shops or servicing their EVs themselves. Notably, the NY DFRA also references the Magnuson-Moss Warranty Act, under which warranties cannot require that maintenance and repairs be performed only by “authorized repair providers.”
The upcoming enforcement of the NY DRFA and the Massachusetts Motor Vehicle Owners’ Right to Repair Act, coupled with the antitrust and federal warranty law claims in the Tesla actions, demonstrate that we are just at the beginning of a major shift in how consumers are permitted to service, repair, and maintain their devices and vehicles. Changes to the right to repair landscape are inevitable, so the only real question for OEMs, independent repair shops, and consumers is how to prepare.
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 Digital Fair Repair Act, N.Y. Gen. Bus. Law § 399-nn (last visited May 22, 2023), https://www.nysenate.gov/legislation/laws/GBS/399-NN.
 Mass. Gen. Laws ch. 93k, § 1 (2013).
 Memorandum of Understanding, among Automotive Aftermarket Industry Association, Coalition for Auto Repair Equality, Alliance of Automobile Manufacturers, and Association of Global Automakers, dated as of January 15, 2014 (available at https://www.documentcloud.org/documents/22054476-mou_signed_1_15_14).
 Massachusetts Question 1, “Right to Repair Law” Vehicle Data Access Requirement Initiative (2020), Ballotpedia (last visited May 22, 2023), https://ballotpedia.org/Massachusetts_Question_1,_%22Right_to_Repair_Law%22_Vehicle_Data_Access_Requirement_Initiative_(2020).
 Chris Villani, Mass. ‘Right To Repair’ Law To Go Into Effect Amid Stalled Suit, Law360 (Mar. 8, 2023), https://www.law360.com/articles/1583571.
 Lambrix v. Tesla, Inc., Case: 3:23-cv-01145 (Mar. 14, 2023); Orendain v. Tesla, Inc., Case 3:23-cv-01157 (Mar. 15, 2023).
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