This was not some secret action done in a secret database.
Tesla intentionally shipped the car to a salvage auction instead of three other nearby auctions. The day the auction closed and the car sold, IAAI reported the car to NMVTIS as a salvage car. IAAI did all this at Tesla's direction when they repped the car. When a car runs at auction, it has "lights" that indicate condition and announcements that declare condition. The buyers in the lane would have known and heard all this. Prime Sales' buyer had to know the car was salvage. He was at at a salvage auction, and most likely the auctioneer announced it as a salvage. There is no question Prime Sales screwed the OP.
get management on the phone for Carfax and Autocheck, as well as CA consumer protection and their DMV good luck, think a lawyer will def help, maybe legal threats will get the dealer to buy the MY back
teslamotorsclub.com
The point of my detailed post above was to encourage the OP/buyer to pursue Prime Sales to unwind the sale. They misrepresented the car (either intentionally or unintentionally, but if untintenionally, it was through their ignorance). In Tesla's mind, they [tpnsn;u did everything correctly and openly. It is a stretch to hope Tesla would undeclare a car salvage that they intentionally salvaged because of a dirty dealer.
But there is no evidence IAAI reported it as salvage or that Tesla marked the car as salvage internally prior to the sale. As per IAAI's disclaimer, not all sales done by them are salvage, but their sale may still be reported to a database where most cars there are salvage, so some databases would automatically assume it's salvage even if they are not.
"sometimes"???????
teslamotorsclub.com
My take is IAAI reported it as a sale done by their auction yard, and then after the sale Tesla's database automatically assumed it was salvage based on the sale reported as done by IAAI (exactly the scenario posted in the disclaimer). Incorrect salvage status has happened before and Tesla is able to fix (as they did with the supercharging). You seem to be assuming a salvage marking on Tesla's database is permanent and not reversible, when that is not the case. That's why I suggested OP to make 100% sure if title is clean and no title washing and go from there.
Yes it's possible the dealer lied, but then it shouldn't be possible to reverse the supercharger access if that was the case. Anyways I guess we will find out further when the warranty status is worked on.
Summary of my assumption:
Tesla Lease lists IAAI sale as clean title -> IAAI reports sale to NMVTIS as clean title -> Tesla uses NMVTIS or a database that takes from NMVTIS which assumes any sale on NMVTIS is salvage (as disclaimer by IAAI says may happen) -> Tesla marks car as salvage incorrectly (which is reversible)
Your assumption:
Tesla Lease marks car as salvage internally and lists IAAI sale as salvage (but with a clean title that is never changed to salvage?) -> IAAI discloses in auction Tesla has listed car as salvage and reports sale to NMVTIS as salvage -> Dealer is fully aware and lies about it to buyer taking advantage of title processing time/legal loophole
This would not be reversible given the car is salvage from the start and was marked without relying on a third party database.
I looked actually closer at the provisions of the vehicle code. Even if Tesla self insured the car, if they declare it internally as a total loss, they are still legally required to report it the DMV as such in 10 days and get it titled as salvage:
"(d) Whenever a total loss salvage vehicle is not the subject of an insurance settlement, a self-insurer, as defined in Section 16052, shall, within 10 days from the loss, forward the properly endorsed certificate of ownership or other evidence of ownership acceptable to the department, the license plates, and a fee in the amount of fifteen dollars ($15) to the department."
https://codes.findlaw.com/ca/vehicle-code/veh-sect-11515/
As such there isn't really a loophole where Tesla is allowed to have the car remain as a clean title in California while internally marking the car as salvage themselves.