Fisker Automotive files legal counterattack in Tesla suit

With a motion to compel arbitration, maker of electric sports cars kicks off round 2 of a legal fight with its rival, which began shortly after Fisker unveiled its $80,000 Karma.

Martin LaMonica Former Staff writer, CNET News
Martin LaMonica is a senior writer covering green tech and cutting-edge technologies. He joined CNET in 2002 to cover enterprise IT and Web development and was previously executive editor of IT publication InfoWorld.
Martin LaMonica
3 min read

Fisker Automotive is seeking a speedy end to a lawsuit filed against it by electric-sports car rival Tesla Motors.

In a statement released on Wednesday, Fisker said it has filed for arbitration, a motion that will be decided by the San Mateo Superior Court by June 11, 2008.

The contract between Fisker and Tesla had a clause that required that any disputes be handled through arbitration in the Orange County, Calif., within 90 days, according to Fisker. Tesla filed its suit against Fisker in San Mateo Superior Court.

Fisker Automotive CEO Henrik Fisker dismissed Tesla's suit as "ridiculous." Martin LaMonica/CNET News.com

By filing a motion to compel arbitration, Fisker is trying to avoid costly litigation and resolve the matter quickly, according to its statement:

Because Tesla has sued, Fisker must enforce the terms of the contract and have this matter submitted to arbitration so as to obtain a decision as quickly as possible. Fisker must vigorously defend the meritless litigation brought by Tesla, despite its interference with Fisker's objective to bring environmentally progressive cars to market.

It is ironic that Tesla is using precious financial resources pursuing costly litigation to try and prevent an entirely different clean technology from being made available to the public. Tesla and its investor would be better served if Tesla devoted its money and time to resolving its own technical and management issues, rather than attacking important innovations of other environmentally conscious companies.

Tesla filed suit against against Fisker Automotive last month, alleging that CEO Henrik Fisker's design company, Fisker Coachbuild, stole Tesla technology when it did design work on a planned Tesla all-electric sedan.

In the suit, Tesla alleges that Fisker and Bernhard Koehler, Fisker Coachbuild's chief operating officer, accepted the contract "to gain access to confidential design information and trade secrets, then announced a competing vehicle."

In Wednesday's statement, Fisker said it took "great offense" at allegations that it did substandard work. The language echoes comments that CEO Fisker made on Tuesday, when he called the Tesla suit "ridiculous" and "just sour grapes."

Fisker did design work for Tesla's upcoming Whitestar, a sedan that will run on an all-electric motor. In an interview with CNET News.com, Fisker said Tesla made significant design changes during the process and that the company has encountered many technical problems.

In its statement on Wednesday, Fisker argued that the Whitestar will not compete with the Karma, the $80,000 sports car that Fisker plans to release at the end of next year. It will run on a battery for the first 50 miles and have a gasoline engine that will feed a generator that charges a Fisker-designed lithium ion battery.

From the statement:

"Fisker's performance of body and interior design under the contract with Tesla had nothing to do with Tesla's electric drive technology. The Karma, which is being produced by Fisker Automotive, is based upon a clean hybrid drive technology which is proprietary to Fisker's partner, Quantum Technologies.

Tesla's contract with Fisker acknowledges that Fisker is entitled to perform identical services for others. Tesla actually retained Fisker to perform additional design services regarding the WhiteStar, after Fisker's association with Quantum Technologies was known throughout the industry via press release.

Not once did Tesla ever complain to Fisker regarding Fisker's performance under the contract, until after the Karma had been shown to the world.

Separately, CEO Fisker on Tuesday said the company intends to make a second battery car that will be priced at about $40,000. He said the expected release would be four or five years.