Tesla settles defect case involving fatal Indianapolis crash

Tesla has settled another case linking a passenger’s death with an alleged vehicle design defect, records show, the second time in less than two months that the automaker has avoided a jury trial just days before it was set to begin.

The lawsuit, filed in 2019 and settled for an undisclosed amount Friday, alleged that a Tesla vehicle suddenly accelerated in downtown Indianapolis in 2016, then burst into flames after it collided into a tree and adjacent parking structure. In the lawsuit, the plaintiffs argued that the 2015 Model S involved in the collision was defective because of “the propensity of the vehicle to catch fire” and “the defective design of the door latch system.”

The suit claims that a combination of alleged defects prevented the passenger, Kevin McCarthy, from exiting the vehicle before succumbing to severe thermal injuries. The driver, who was intoxicated, according to court documents, also died as a result of the crash. In response to the complaint, Tesla denied there were any issues with the vehicle, and said “misuse or improper maintenance caused or contributed” to the fatal crash.

The latest settlement comes after Tesla struck a confidential agreement in April over a high-profile suit in Northern California that claimed the company’s Autopilot technology played a role in the fatal crash of an Apple engineer. While both cases allege different defects with Tesla’s design, the latest settlement doesn’t involve the automaker’s self-driving technology. The back-to-back accords suggest the automaker is open to settling such cases despite CEO Elon Musk’s 2022 vow on Twitter to never settle “an unjust case against us even if we will probably lose.”

A lawyer for the McCarthy family declined to comment; representatives for Tesla did not respond to an email requesting comment on the settlement.

In one case that did make it to trial this year, a jury was asked to determine whether the company was liable for a 2018 incident in which a toddler climbed into the driver’s seat of a Tesla and seemed to activate the parked vehicle. The car then accelerated toward the child’s pregnant mother, shattering her pelvis and leg. After several days of trial, the judge granted Tesla’s motion for a “nonsuit,” in which a court rules that a plaintiff has failed to make a legal case or bring sufficient evidence.

Still, Tesla is facing a string of lawsuits around the country that blame various defects for fatal or otherwise serious collisions. At least eight of the pending lawsuits headed to trial in the coming year involve fatal or otherwise serious crashes that plaintiffs claim occurred while the driver was relying on Autopilot. These cases also come as the company faces heightened scrutiny from federal regulators at the National Highway Traffic Safety Administration, which is investigating whether Tesla’s Autopilot technology misleads drivers into thinking the “automation has greater capabilities than it does.”

The plaintiffs in the 2016 Indianapolis crash claimed that the 27-year-old driver, Casey Speckman, lost control of the 2015 Model S when the vehicle suddenly accelerated as she attempted to avoid an oncoming vehicle headed the wrong way on the one-way street. The vehicle, which was owned by her boss and passenger, Kevin McCarthy, then plowed into a tree and came to a stop against an adjacent parking structure and then burst into flames.

Tesla’s cars have been the subject of numerous complaints of fires allegedly linked to its batteries. Electric car batteries can release massive amount of energy, causing a fire that can burn for hours longer, and more intensely, than a fire in a car with an internal-combustion engine, experts say.

According to the lawsuit filed by McCarthy’s family, witnesses observed him attempting to escape the vehicle. But “due to defects in the vehicle” he was unable to do so, the complaint said. The suit said McCarthy was unable to “quickly and safely” exit the vehicle because of the post-crash fire and the “the defective design” of the door latch system.

In its response to the complaint, Tesla said its vehicle is “state-of-the-art” and “complied with all applicable government standards and requirements.”

Separately, the Speckman family filed a similar suit against Tesla in 2019. Tesla attempted to get the suit dismissed, but a judge denied that request in 2023. About two months later, records show, Speckman’s family reached a settlement agreement with Tesla.