Tesla has been stuck in a design lawsuit with rival electric vehicle startup Nikola Motor Company for almost two years now — and Nikola’s CEO says the $2 billion battle will continue. Nikola alleges that Tesla’s electric truck designs (its big rigs, not its consumer-focused Cybertruck) infringe upon a series of three patents for the Nikola One truck.
In a since-deleted tweet, CEO Trevor Milton said:
Tesla loses bid to invalidate @nikolamotor patents in USPTO dispute. USPTO not only upheld Nikola semi truck important patents but refused Tesla’s ask to modify our patents. Two billion dollar lawsuit moving forward. We will defend our company’s IP no matter who it is.
In the midst of the ongoing lawsuit, Nikola has received a $4.1 million loan from the Small Business Administration’s Paycheck Protection Program (PPP). Milton says the loan will cover the payroll of Nikola’s 300 employees for about two months.
Nikola’s lawsuit is on shaky ground, to say the least. But the U.S. patent office’s decision to refuse Tesla’s latest dispute with the case will mean expensive trouble for Tesla moving forward.
Sorry, but who is this Nikola? — If you haven’t heard of Nikola Motor Company, you’re not alone. Besides having a common namesake — Serbian-American inventor, Nikola Tesla — the two companies also share similar goals. Both hope to revolutionize the production and availability of all-electric vehicles.
But Nikola is lagging behind Tesla in important ways. For a start, Tesla has been around since the early aughts, while Nikola was only founded by Milton about five years ago. Then there's the fact Nikola focuses its efforts on hybrid and all-electric big rigs, which are only a small part of Tesla’s business, and less headline-grabbing than commuter vehicles.
Last month, Nikola announced it plans to merge with publicly-traded company VectoIQ Acquisition Corp, in the hopes that doing so will accelerate the production of its vehicles. The combined company will be called “Nikola Corporation.” Milton will serve as the executive chairman of the merged entity.
Going nowhere fast — Nikola’s lawsuit against Tesla is rooted in similarities between the companies’ designs for their hybrid and electric trucks. Nikola claims the fuselage of the Tesla semi is too similar to the design of the Nikola One truck, which was revealed a year earlier. The three complaints center on the fuselage itself, the wrap-around windshield, and the mid-entry door design. Nikola states in the lawsuit that it worries customers will confuse the two trucks and attribute problems associated with Tesla’s truck to the Nikola One, thereby hurting Nikola’s image.
But neither Tesla nor Nikola are the first to come up with these ideas, as Electrek points out. Tesla attempted to squash the lawsuit by bringing this up to the U.S. patent office, but the office chose to uphold Nikola’s patents.
Nikola’s CEO called this a victory in his since-deleted tweet, but really it just means the lawsuit will continue. There’s no winner here, at least not yet. Except for the respective legal teams, of course. Because of the COVID-19 pandemic, the lawsuit will likely take even longer now. Both companies will continue paying hefty fees to fight a battle over ideas neither of them actually came up with. And even if Nikola wins, it's not clear it'll ever be able to truly catch up with Tesla.