Tesla and SpaceX Take Terafab Trademark Fight to Federal Court
The companies filed for declaratory judgment after six months of negotiations with TERA-print LLC collapsed.
Tesla and SpaceX have filed a lawsuit in federal court seeking a ruling that their planned Terafab chip factory does not infringe on a trademark held by a small Illinois-based nanotechnology company.
What Happened
The legal dispute originated on May 18, when Tesla submitted three U.S. trademark applications for “Terafab” and “Tesla Terafab,” covering semiconductor chips and related manufacturing services. Five days later, TERA-print LLC, which has held a federal trademark for “Tera-Fab” since 2021 for a desktop photolithography printer used in research, sent a cease and desist letter. Tesla and SpaceX allege that TERA-print acted opportunistically by applying to expand its trademark registration to include semiconductor materials and AI design services on May 22, just one day before sending the cease and desist letter and two months after Tesla’s public announcement of the project. After TERA-print threatened legal action in June, the parties held six negotiation sessions between June and August. When these talks failed to produce a settlement, Tesla, SpaceX, and SpaceXAI filed for declaratory judgment in the U.S. District Court for the Western District of Texas to prevent TERA-print from filing its own infringement claim.
Why It Matters
The outcome of this litigation could determine the branding for a $16.8 billion industrial complex in Grimes County, Texas, which is planned to produce chips for Tesla’s Optimus robots, AI computing infrastructure, and SpaceX’s orbital data centers. Tesla and SpaceX argue that the market positions are distinct enough that consumers would not confuse a large-scale semiconductor factory with TERA-print’s tabletop lab equipment. However, TERA-print maintains that it holds a Defense Department contract for semiconductor fabrication and partially owns an AI company built on its products, asserting that it will vigorously defend its intellectual property rights. This case highlights the increasing legal scrutiny of high-profile EV and aerospace branding as companies expand into semiconductor manufacturing.
The Bottom Line
A federal judge in Austin must now decide whether the name “Terafab” infringes on TERA-print’s existing trademark, a ruling that will impact the public identity of the planned Tesla-SpaceX chip manufacturing facility.
