Tesla drops lawsuit against Alameda County over Fremont factory reopening

Tesla has officially dismissed a lawsuit filed earlier this month against Alameda County that sought to force the reopening of its factory in Fremont, Calif.

The dismissal, which was granted Wednesday, closes the loop on a battle between Tesla CEO Elon Musk and county health and law enforcement officials. The lawsuit, filed May 9 hours after Musk threatened to sue and move operations out of state, sought injunctive and declaratory relief against Alameda County. Reuters was the first to report the dismissal.

The lawsuit was filed after Tesla's plans to resume production at the Fremont factory were thwarted by the county's decision to extend a stay-at-home order issued to curb the spread of COVID-19, the disease caused by coronavirus. Two days after filing the lawsuit, Musk reopened the factory in defiance of the county orders.

Production at the company's Fremont factory - where its electric vehicles are assembled - has been suspended since March 23 due to stay-at-home orders issued by Alameda County and California Gov. Gavin Newsom.

Musk had based the reopening on newer guidance issued by Newsom that allows manufacturers to resume operations. However, the governor's guidance included a warning that local governments could keep more restrictive rules in place. Alameda County, along with several other Bay Area counties and cities, extended the stay-at-home orders through the end of May. The orders were revised and did ease some of the restrictions. However, it did not lift the order for manufacturing.

Tesla and county officials continued to negotiate even as the company called workers back and prepared to resume production. The county agreed to allow Tesla to continue to ramp minimum basic operations in order to prepare for operations.