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Tesla Drops Lawsuit Against Alameda County Over Coronavirus Restrictions

The move comes after Tesla told its employees that the company reached an agreement with county officials to allow the plant to resume operations.

Tesla dropped its lawsuit against California’s Alameda County over its stay-home order on Wednesday after the company told employees that the factory was granted approval to resume operations. Alameda County’s interim health officer reportedly signed off on a safety plan for the Fremont plant to reopen starting this week. The move comes after CEO Elon Musk told Tesla workers in early May that the factory would be restarting production in defiance of the county order that required it to remain shuttered. The lawsuit, filed in the U.S. District Court for California’s Northern District, sought a permanent injunction from the order, saying it contradicted Gov. Gavin Newsom’s statewide policy that allowed manufacturers to resume operations.

Tesla alleged that it was “impacted by inefficiencies related to the temporary suspension of production and deliveries in many locations” in the first quarter. Musk also threatened to move the manufacturing plant outside of California.