284 F.R.D. 504 (C.D.Cal. 2012), CV 10-09508 MMM (AJWx), Keegan v. American Honda Motor Co., Inc.
| Citation | 284 F.R.D. 504 |
| Opinion Judge | MARGARET M. MORROW, District Judge. |
| Party Name | David J. KEEGAN; Luis Garcia, Betty Kolstad; Carol Hinkle; Eric Ellis; Charles Wright; Jonathan Zdeb; individually and behalf of all others similarly situated, Plaintiff, v. AMERICAN HONDA MOTOR CO., INC.; Honda of AmericaManufacturing, Inc., Defendant. |
| Attorney | Cory S. Fein, Cynthia B. Chapman, Michael A. Caddell, Caddell and Chapman, Houston, TX, Matthew Mendelsohn, Mazie Slater Katz & Freeman LLC, Roseland, NJ, Payam Shahian, Ramtin Shahian, Strategic Legal Practices APC, Los Angeles, CA, Robert L. Starr, Law Office of Robert L. Starr, Woodland Hills,... |
| Case Date | June 12, 2012 |
| Court | United States District Courts, 9th Circuit, U.S. District Court — Central District of California |
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ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS' MOTION FOR CLASS CERTIFICATION
On December 10, 2010, plaintiffs David J. Keegan, Luis Garcia, Betty Kolstad, Carol Hinkle, Eric Ellis, Charles Wright, and Jonathan Zdeb filed this putative class action against American Honda Motor Co., Inc., and Honda of America Manufacturing, Inc., alleging claims under the California Consumer Legal Remedies Act (" CLRA" ), the California Unfair Competition Law (" UCL" ), the
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Song-Beverly Act, the Magnuson-Moss Warranty Act, California Commercial Code § 2313, and various states' consumer protection and implied warranty statutes.1 Plaintiffs filed a first amended complaint on May 23, 2011.2
On November 21, 2011, plaintiffs filed a motion for class certification under Rules 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure. 3 Defendants opposed the motion.4 In response to the court's tentative ruling issued at the hearing, both parties submitted supplemental briefs regarding the effect of state law on class certification issues. 5
I. FACTUAL BACKGROUND
A. The Complaint's Allegations
Plaintiffs bring this action on behalf of all individuals who purchased or leased certain allegedly defective model year 2006 and 2007 Honda Civic and 2006 through 2008 Honda Civic Hybrid vehicles that were designed, manufactured, distributed, marketed, sold, and leased by defendants (collectively, the " class vehicles" ).6 Plaintiffs allege that the rear suspension in the class vehicles is defective.7 Specifically, plaintiffs allege that the rear control arm originally installed in the vehicles was too short.8 This purported defect (" the suspension defect" ) affects the alignment and geometry of the rear suspension, causing the vehicles to become misaligned. This in turn results in uneven and premature wear on the rear tires.9 The misalignment also causes " occupants to experience an extremely rough ride, as well as exceptionally loud and disruptive noise, while driving the class vehicles." 10
Plaintiffs allege that Honda learned of the suspension defect through pre-release testing data, early consumer complaints to Honda and its dealers, testing conducted in response to the complaints, and " other internal sources." 11 They contend that Honda " actively
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concealed" the defect from its customers,12 but had a duty to disclose the defect because it poses an " unreasonable safety hazard," and Honda had " exclusive knowledge or access to material facts" about the vehicles and the rear suspension problem that were unknown and not reasonably discoverable by plaintiffs.13
Plaintiffs contend that the defect creates a safety hazard because a driver has only three means of controlling a car— braking, accelerating, or steering. Each is dependent on rolling friction with the ground beneath the wheels, and the only contact the vehicle has with the ground is through its tires. 14 The defect allegedly causes uneven tread wear on the tires, which can result in " catastrophic" tire failure because one side of the tire receives more pressure than the other.15 The defect can thus " suddenly and unexpectedly cause tire failure while the vehicle is in operation," which can lead to car accidents, personal injury, or death.16
The cost of repairing the defect and replacing the worn tires allegedly can run " hundreds, if not thousands, of dollars." 17 The defect also purportedly requires that tires be replaced prematurely, sometimes after less than 20,000 miles.18 Plaintiffs assert that the expected tread wear of properly functioning tires in the class vehicles is approximately 75,000 miles or more.19
Plaintiffs contend that " hundreds, if not thousands," of purchasers and lessees of class vehicles have experienced the defect, filed complaints with the National Highway Traffic Safety Administration (" NHTSA" ), and posted information about the problem on the internet.20 They maintain that although Honda knew of the problem, it took no steps to notify customers of the defect or provide relief until January 2008, two years after the class vehicles had been placed on the market.21 At that point, Honda issued a technical service bulletin (" TSB" ) to its dealers and began covering " certain costs associated with temporary correction" of the defect, such as replacing the rear control arm. It also provided reimbursement for prematurely worn tires.22 By the time Honda took these steps, however, many of the vehicles had already been sold or leased, and class members had replaced worn tires " without adequate reimbursement." 23 Plaintiffs allege that, although the TSB purportedly did not reference certain class vehicles, the defects it noted are found in all class vehicles.24
The TSB stated that the too-short rear control arms should be replaced with longer control arms.25 Plaintiffs assert that the recommended modification is " only a temporary fix" that does not address the underlying problem. They contend that consumers whose vehicles are modified will experience suspension defects in the future, which will require costly repairs, and give rise to safety hazards.26 Plaintiffs allege that defendants know the recommended modification does not
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fix the defect and that it will only " prolong the amount of time that will elapse" before the defect manifests again.27 They contend the delay is designed to ensure that the defect occurs outside the warranty period, shifting financial responsibility for the defect to class members.28
Although the TSB appears to concern vehicles still under warranty, plaintiffs assert that in practice, the modification is provided only to the " most persistent customers ... who visit Honda's dealers and complain loudly enough about the Suspension Defect and the premature tire wear it causes." 29 They contend that Honda's dealers fail to advise consumers about the cause of the tire wear they are experiencing and about the TSB. Despite knowing of the defect since 2006, and of the proposed fix for it since 2008, dealers purportedly attribute the tire wear to consumers' " driving habits, road conditions, and improper maintenance." 30 Honda has not issued a recall for the vehicles, offered reimbursement for costs incurred, or provided replacement or repairs.31
B. The Plaintiffs
The complaint was filed on behalf of seven named plaintiffs located in six different states. Although plaintiffs' specific interactions with Honda regarding the alleged defect, and the severity of the defect they have experienced, vary, each purchased a Honda Civic from a Honda dealer and complained about premature wear of the tires. The plaintiffs are:
• David J. Keegan, a California citizen and resident of Dublin, who purchased a new 2007 Honda Civic from Dublin Honda in April 2007; 32
• Luis Garcia, a New York citizen, who purchased a new 2007 Honda Civic EX on March 17, 2007; 33
• Eric Ellis, a resident of Adrian, Oregon, who purchased a new 2007 Honda Civic LX from Tom Scott Honda in Nampa, Idaho on July 6, 2007; 34
• Charles Wright, a citizen of Montana and resident of Missoula, who purchased a Honda Civic Hybrid from University Motors in Missoula on March 3, 2006; 35
• Betty Kolstad, a citizen of California and resident of Big Ben, California, who purchased a 2006 Honda Civic from Auto West Honda in Roseville, California on October 15, 2009, with a certified pre-owned car warranty for 60 days. 36
• Carol Hinkle, a citizen of North Carolina and resident of Salisbury, who purchased a Honda Civic LX at Salisbury Honda in April 2008; 37
• Jonathan Zdeb, a resident of West Palm Beach, Florida, who purchased a new 2007 Honda Civic SI from Holman Honda in Fort Lauderdale, Florida in January 2007.38
C. The Nature of the Alleged Defect
According to plaintiffs, the class vehicles are designed to give the rear wheels 1.5 degrees of " negative camber." 39 " Negative camber" means that the top of the wheel is slanted toward the car relative to the bottom of the wheel. The parties do not dispute that some degree of negative camber aids vehicle stability and gives the car a different feel while driving, but plaintiffs maintain that excessive negative camber can lead to disruptive
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tire noise and premature tire wear.40 It is undisputed that all class vehicles were designed to have 1.5 degrees of negative camber in the rear suspension. Design tolerances, however, permit a variance of 0.75 degrees in either direction, meaning that the class vehicles may have as little as 0.75 degrees negative camber or as much as 2.25 degrees of negative camber and still remain within acceptable tolerances.41 The purported defect is addressed in greater detail in the balance of this order.
II. DISCUSSION
A. Legal Standard Governing Class...
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