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VP Turnover Continues at Tesla With Lawyer’s Departure

April 18, 2016, 10:25 PM

Business would seem to be booming at Tesla Motors Inc: Earlier this month, it announced that demand for the Model 3, coming in 2017, exceeded expectations, so it is boosting production.

And yet it’s losing executives, including most recently James Chen, vice president of regulatory affairs and deputy general counsel — and a visible figure on the front line of the company’s push to sell directly to consumers.

Chen did not respond to requests for comment, but on Monday a Tesla spokeswoman confirmed his departure, which was first reported by the clean fuels website Electrek.

His exit comes two months after two other vice presidents left the company.

Michael Zanoni, vice president of finance, returned to in February, to take a job as finance vice president, according to his LinkedIn page. Bloomberg reported in March that Vice President of Global Communication Ricardo Reyes left Tesla after less than 18 months.

Chen had joined Tesla in Washington, D.C. in August 2010, originally as director of public policy and associate general counsel. He was promoted in 2013, according to his LinkedIn page. He also worked as a partner at both Crowell & Moring and Hogan & Hartson, and is a veteran of the Environmental Protection Agency.

Most recently, at Tesla, Chen helped to temporarily stop a bill in Indiana that would have made it illegal for any car manufacturer to hold a dealer license in the state after 2017. It would have forced customers to buy vehicles from third-party dealerships, Electrek reported.

Tesla faces similar battles in several states, and would like to sell its vehicles directly to its customers instead of using dealerships, a move that helps it cut costs, according to John McGinnis, a law professor at Northwestern University.

“The consumer and the manufacturer both have a common interest in the lowest cost of distribution, and this kind of legislation is thwarting that,” McGinnis told Big Law Business. “It’s a very bad idea to have states restrict the ability of the manufacturers to make that choice, and that’s what’s going on. It’s essentially economic protectionist legislation.”