Tesla drops lawsuit against Alameda County, California

An aerial view of the Tesla Fremont factory on May 13, 2020 in Fremont, California.

Justin Sullivan | Getty Images

Tesla dropped the lawsuit it filed in early May against California’s Alameda County on Wednesday.

In the lawsuit, Tesla claimed that the county’s rules on mandatory closings of Covid-19 were at odds with California state policy. Tesla had requested a permanent injunction that would prevent the enforcement of county orders.

Tesla stopped production at the end of the day on March 23, but resumed operations earlier this month. The company said it was “affected by inefficiencies related to the temporary suspension of production and deliveries to many locations” in the first quarter.

The lawsuit was viewed as a gesture by many because Tesla did not seek a temporary restraining order, which could have been implemented, and allowed him to legally manufacture vehicles immediately. Instead, Tesla flouted health orders and simply started production on the weekend of May 9.

While Tesla said it was “speeding up” production, employees told CNBC and shared internal correspondence with CNBC suggested that full shifts were reserved, and that the plant had been close to normal occupancy since the weekend after Mother’s Day.

The right to reopen has gained support from President Donald Trump.

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