Honda hybrid lawsuit: Are new mileage labels misleading?

Honda hybrid promised 50 miles per gallon. But as batteries age, the true mileage drops. A new lawsuit argues that that makes Honda hybrid labels misleading?

A woman who expected her 2006 Honda Civic Hybrid to be her dream car wants Honda to pay for not delivering the high mileage it promised. But rather than joining other owners in a class-action lawsuit, she is going solo in small claims court, an unusual move that could offer a bigger payout if it doesn't backfire.

A trial is set for Tuesday afternoon in Torrance, where American Honda Motor Co. has its West Coast headquarters.

Heather Peters says her car never came close to getting the promised 50 miles per gallon, and as its battery deteriorated, it was getting only 30 mpg. She wants Honda to pay for her trouble and the extra money she spent on gas.

Peters, a former lawyer who long ago gave up her bar card, has devised a unique legal vehicle to drive Honda into court — a small claims suit that could cost the company up to $10,000 in her case and every other individual case filed in the same manner.

If other claimants follow her lead, she estimates Honda could be forced to pay $2 billion in damages. No high-priced lawyers are involved and the process is streamlined.

"I would not be surprised if she won," said Richard Cupp Jr., who teaches product liability law at Pepperdine University. "The judge will have a lot of discretion and the evidentiary standards are relaxed in small claims court."

A win for Peters could encourage others to take this simplified route, he said.

"There's an old saying among lawyers," Cupp said. "If you want real justice, go to small claims court."

But he questioned whether her move, supported by publicity on the Internet and elsewhere, would start a groundswell of such suits. He suggested that few people would want to expend the time and energy that Peters has put into her suit when the potential payoff is as little as a few thousand dollars.

Peters opted out of a series of class-action lawsuits filed on behalf of similar Honda hybrid owners when she saw a proposed settlement would give owners no more than $200 cash and a rebate of $500 or $1,000 to purchase a new Honda.

The settlement would give trial lawyers $8.5 million, Peters said.

"I was shocked," she said. "I wrote to Honda and said I would take $7,500, which was then the limit on small claims in California. It is going up to $10,000 in 2012."

She said she also offered to trade her hybrid for a comparable car with a manual transmission, the only thing she trusted at that point.

"I wrote the letter and I said, 'If you don't respond, I will file a suit in small claims court.' I gave them my phone number," she said. "They never called, and I filed the suit."

She said she also sent emails to top executives at Honda with no response.

Aaron Jacoby, a Los Angeles attorney who heads the automotive industry group at the Arent Fox law firm, said Peters' strategy, while intriguing, is unlikely to change the course of class-action litigation.

"In the class-action, the potential claimants don't have to do anything," Jacoby said. "It's designed to be an efficient way for a court to handle multiple claims of the same type."

He also questioned her criticism of class-action lawyers for the fees they receive. Jacoby, who handles such cases, said lawyers who take on the multiple clients involved do extensive work — sometimes spanning years — and are not in it just for money.

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