Worku v. Tesla
- Eric Tostrud
- 0:26-cv-00131
- U.S. District Court · District of Minnesota
- 25
Counsel of record per CourtListener. Firm names are approximate.
In Worku v. Tesla, Judge Tostrud denied Tesla's motion to compel arbitration, ruling that Mr. Worku's electrocution claim at a supercharger does not arise out of his vehicle purchase contract.
Consumers who have signed broad arbitration clauses in vehicle purchase contracts (or similar consumer contracts) and later suffer personal injuries in incidents only loosely connected to the product purchased. This ruling may affect whether such consumers can bring tort claims in court rather than in arbitration, particularly where the injury arises from a separate instrumentality — such as a charging station — not directly addressed in the purchase contract.
What happened
In Worku v. Tesla, Inc. (No. 26-cv-131), Tiger Worku alleges he was electrocuted when he picked up a charging connector at a Tesla supercharger station in St. Paul and suffered physical and mental injuries. He sued Tesla under state tort law for negligence, premises liability, and strict products liability. Tesla responded by moving to compel arbitration under the Federal Arbitration Act, pointing to a broad arbitration clause in the vehicle purchase contract Mr. Worku signed, which covered "any dispute arising out of or relating to any aspect of the relationship" between the parties.
The central legal question was whether the Federal Arbitration Act — the federal law governing arbitration agreements — required this personal-injury tort claim to go to arbitration. The Act enforces arbitration only for disputes "arising out of" the parties' contract. The court concluded that Tesla's arbitration clause, which extended to the entire "relationship" between the parties rather than just the contract, went beyond what the Act covers. Even treating the clause as limited to the contractual relationship, the court found that Mr. Worku's electrocution claim had no direct connection to the vehicle purchase contract, which addressed standard car-sale terms like price, delivery, and warranty, and did not meaningfully address superchargers.
Judge Tostrud denied Tesla's motion to compel arbitration. He reasoned that even if the parties had fulfilled all their obligations under the purchase contract, Mr. Worku's tort claims for the supercharger injury would still exist — meaning those claims do not arise from the contract. The court also rejected Mr. Worku's separate arguments that the arbitration clause was invalid due to lack of mutual agreement or unconscionability, but those rejections did not change the outcome, since the dispute still fell outside the scope of what the Act requires to be arbitrated.
The detailed version
- Worku v. Tesla · No. 0:26-cv-00131
- Eric Tostrud
- June 25, 2026
Background
On August 13, 2024, Tiger Worku purchased a Tesla Model 3 from Tesla, Inc. The purchase contract included an arbitration clause requiring the parties to arbitrate "any dispute arising out of or relating to any aspect of the relationship between you and Tesla," administered by the American Arbitration Association. The clause also allowed either party to opt out of arbitration by mailing a letter within 30 days of signing.
On August 22, 2025, Mr. Worku attempted to charge his Model 3 at a Tesla supercharger station in St. Paul. He alleges that when he picked up the charging connector, he received an electric shock and suffered physical and mental injuries. He filed this suit asserting state-law tort claims of negligence, premises liability, and strict products liability. Tesla moved to compel arbitration under the Federal Arbitration Act (FAA), 9 U.S.C. § 2.
The court has subject-matter jurisdiction based on diversity of citizenship: Mr. Worku is a citizen of Minnesota, Tesla is a citizen of Texas (state of incorporation and principal place of business), and the amount in controversy exceeds $75,000.
Procedural Standard
Because matters outside the pleadings — specifically, the parties' contract — were submitted and considered, the motion to compel arbitration was analyzed under the summary judgment standard of Federal Rule of Civil Procedure 56. Under that standard, the motion must be granted only if there is no genuine dispute of material fact and the moving party is entitled to judgment as a matter of law.
Legal Framework
The FAA mandates enforcement of written arbitration provisions in contracts "evidencing a transaction involving commerce" for controversies "arising out of such contract or transaction." 9 U.S.C. § 2. Courts applying the FAA must determine (1) whether the Act applies to the agreement, (2) whether a valid arbitration agreement exists under state contract law, and (3) whether the dispute falls within the scope of that agreement.
Issue 1: Whether the FAA Applies — The "Contractual Nexus" Theory
The court addressed a threshold question: does the FAA govern arbitration agreements that reach beyond disputes "arising out of" the underlying contract? The court adopted what it called the "contractual nexus theory" — the view, endorsed by a growing number of courts including the Second and Eleventh Circuits, that § 2's "arising out of" language restricts the FAA's enforcement mandate to disputes causally connected to the contract.
The court found Tesla's arbitration clause — covering disputes relating to "any aspect of the relationship" — is facially broader than the FAA's statutory text. Because the parties' relationship can be broader than their contract, the clause exceeds § 2's limitations. The Eighth Circuit has not directly adopted the contractual nexus theory, but the court read its precedents in Fleet Tire Services and Parm v. Bluestem Brands as consistent with and modestly supporting it. Cases enforcing infinite arbitration clauses (such as the Tenth Circuit's Zink decision and the Fourth Circuit's Mey decision) were distinguished or found unpersuasive because they either addressed a different issue or did not analyze the § 2 threshold question.
The court also declined to adopt a "Price Is Right" rule that would render any arbitration clause automatically unenforceable if written more broadly than the FAA allows, noting that all relevant case law instead looks to the underlying dispute to determine applicability. The court reasoned this approach is akin to "blue penciling" the clause — enforcing it only to the extent it accords with the statute.
Issue 2: Validity of the Arbitration Agreement Under Minnesota Law
Mutual assent
Mr. Worku argued there was no valid contract because the parties lacked a meeting of the minds about the arbitration clause's scope. The court rejected this, finding that the argument was really about contract interpretation, not contract formation. The terms were known, unambiguous, and identical in offer and acceptance; by objective manifestations, a contract was formed.
Unconscionability
Mr. Worku argued the clause was unconscionable if read at full breadth. The court found it unnecessary to resolve this because § 2 itself limits the enforceable scope. But even reaching the merits, the court rejected the argument. Under Minnesota law, unconscionability requires both procedural and substantive unconscionability. The clause was not procedurally unconscionable because Mr. Worku had a meaningful choice — he could have opted out of arbitration by mailing a letter within 30 days of purchase — and he did not address the opt-out provision in his brief. Because procedural unconscionability was not established, the argument failed without needing to address substantive unconscionability. The court also noted that finding it substantively unconscionable to arbitrate all future claims between contracting parties would be in tension with the Supreme Court's ruling in AT&T Mobility LLC v. Concepcion, which prohibits treating arbitration agreements as inherently suspect.
Issue 3: Scope — Whether the Dispute Falls Within the Agreement
Even treating the clause as limited to the contractual relationship, the court concluded Mr. Worku's injury claim falls outside the agreement's scope.
The contract covers standard car-sale terms: purchase price, delivery, transfer of title, hardware, and warranty. It mentions superchargers only once — to incorporate a "Supercharger Fair Use Policy" by reference — and no party discussed that incorporated provision. Applying the "direct relationship" test from Anderson v. Hansen (8th Cir. 2022), the court found that if Tesla and Mr. Worku had fully performed their obligations under the contract, Mr. Worku would still have his tort claims for the electrocution. The alleged injury does not arise from the same operative facts covered by the contract.
The court rejected Tesla's argument that use of the Supercharger network was integral to the contract and the parties' relationship, for three reasons: (1) Tesla's superchargers are compatible with non-Tesla vehicles, so the injury is conceivable without any relationship to this contract; (2) one can own a Tesla without being a party to this particular purchase contract (e.g., buying used from a third party); and (3) the contract does not meaningfully address superchargers.
Disposition
Defendant Tesla, Inc.'s Motion to Compel Mandatory Arbitration [ECF No. 20] is denied.
Read the full 25-page opinion on CourtListener, the free public archive maintained by the Free Law Project.