Tesla's High-Tech Lawsuits in Silicon Valley War

An anonymous reader writes "After pressing charges against its chief competitor in the race for the world's first production electric sports car that we broke down here recently, Tesla Motors seems to be shifting from the high-tech company re-writing Detroit's script to another Silicon Valley startup trying to sniff out the competition. So says Engadget's legal analyst in an in-depth column breaking down the legal ramifications. From the article: "This could upset the whole race for major production of an electric car in the U.S., which may be the main result of this whole drama. If anything, that's a win for Tesla. Let's just hope the company that set out to upend the automotive industry achieves its competitive goals in the lab and in the marketplace — and keeps its future fights out of the courtroom.""

Familiar situation

[wrook]

I'm curious. Is Tesla looking for more investment money? TFA has an all too familiar ring to it for me. I've worked in a number of startups before. When you're 90% the way there and you run out of money, one of the tactics I've seen is to:

1. Stop paying your bills
2. Get into a big court case that effectively ties you up until your development has a chance to deliver.
3. Go to potential investors and say "Well, we would have delivered on time if it weren't for our competitors cheating. We're in court with them now. As soon as the court case finishes we'll get a good chunk of cash *and* we'll be in full production.

As wacky as it sounds, it's better than saying "Well, we didn't quite meet the sales window, but we're hoping you'll give us more money so that we can keep working..."

I'm not saying this is what is happening. It's looks very similar to what I've seen on a couple of occasions.

Re:Familiar situation

[iamsamed]

I've never been in that situation but I understand that if you start missing deliverables, the VCs usually have some sort of clause that enables them to throw you out on your ass. You lose everything.