California’s Tesla sued for breach of contract by French firm

If you drive north of San Diego for awhile on Interstate 5, you will get to Palo Alto. The city is often considered one of the centers of the high-tech industry, with companies such as Hewlett-Packard, Skype, VMware and Tesla headquartered there.

According to recent news reports, electric auto manufacturer Tesla is facing a breach of contract lawsuit over what a supplier says are unpaid bills.

France’s Lebronze Alloys claims in its lawsuit that it is owed $1.77 million by Tesla. Lebronze says it had a contract to supply metal parts to the California vehicle manufacturer, but Tesla “abruptly pulled the plug on existing contracts,” a news report states.

Lebronze had supplied parts for Tesla’s electric vehicles since 2016. According to the lawsuit filed in the California Northern District Court, the French company alleges breach of contract, breach of covenant of good faith and fair dealing, as well as fraud and deceit.

The French firm says it “made numerous efforts to get Tesla to pay the amounts Tesla owed.” The two companies agreed in 2016 that it would supply parts for up to one and a half million Tesla cars.

Their agreement was modified in February of this year, downsized to parts for just 250,000 vehicles, according to a statement filed with the lawsuit. The French company says that last month, Tesla abruptly, and without required notice, canceled the amended contract, which amounts to a breach of the contract, the plaintiff states.

If you and your company are dealing with related matters, contact a San Diego business law firm experienced in effective breach of contract litigation.