Quackenbush v. Am. Honda Motor Co.

• Docket Number: C 20-05599 WHA
• Decision Date: 01 December 2023
• Parties: MARY QUACKENBUSH, and MARISSA FEENEY, on behalf of themselves and all others similarly situated, Plaintiffs, v. AMERICAN HONDA MOTOR COMPANY, INC., Defendant.
• Court: U.S. District Court — Northern District of California

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MARY QUACKENBUSH, and MARISSA FEENEY, on behalf of themselves and all others similarly situated, Plaintiffs, v. AMERICAN HONDA MOTOR COMPANY, INC., Defendant.

No. C 20-05599 WHA

United States District Court, N.D. California

December 1, 2023

ORDER RE TRIAL AND POST TRIAL MOTIONS

WILLIAM ALSUP, UNITED STATES DISTRICT JUDGE

INTRODUCTION

In this certified consumer class action involving an alleged defective car part, there are a variety of motions from both parties: (1) defendant moves to decertify the class (Dkt. No 350); (2) defendant renews their motion for judgment as a matter of law (Dkt. No. 357, 382); (3) plaintiffs move to alter judgment (Dkt. No. 381); (4) plaintiffs move for attorney's fees and service award (Dkt. No. 377). There are also two outstanding motions to seal (Dkt. Nos. 294 396). This order addresses each in turn.

STATEMENT

The facts of this action are more thoroughly recounted in prior orders. See Quackenbush v. Am. Honda Motor Co Inc., 650 F.Supp.3d 837, 840-42 (N.D. Cal. 2023). In sum, the two certified classes that remain consist of vehicle owners in California and Illinois who purchased vehicles from authorized Honda dealers containing variable timing control actuator 14310- R44-A01 (“VTC actuator”), an engine component that plaintiffs claim was defective, and paid out of pocket to have the defect repaired. Honda discovered the problem with the VTC actuator beginning in 2008, after receiving complaints of rattling, and pursued an eight-year investigation. Plaintiffs' two class claims are that Honda's failure to disclose this defect violated consumer protection statutes under California and Illinois state law, namely California's Consumer Legal Remedies Act (“CLRA”) and the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”). A jury found Honda liable on the Illinois claim for that corresponding class of plaintiffs at trial, but not on the California claim. The parties had stipulated to damages in the event of a finding of liability, and so defendant was found liable for $1,398,624 in damages to the Illinois claim.

The classes consist of owners who paid out of pocket to have their cars repaired. Defendant moves to decertify the classes and renews their motion for judgment as a matter of law. Plaintiffs move to alter the judgment and for attorney's fees. This order follows full briefing and oral argument.

ANALYSIS

This order addresses the outstanding motions in the order listed above.

1. Defendant'S Motion to Decertify Class.

We had a jury trial and Honda lost as to the Illinois class. The jury could reasonably have found the facts against Honda, who wants to relitigate the reasoning that led to the class being certified before trial. It bears repeating that the broader classes sought by plaintiffs' counsel were not certified. Smaller classes consisting of these consumers who actually paid out of pocket to have the defect repaired were the only ones that made it past summary judgment.

Defendant moves to decertify the class because “Plaintiffs have not shown Defendant had knowledge of a defect at the time each class vehicle was sold” (Decertification Br. 5, Dkt. No. 350). Defendant argues that because Honda implemented varying countermeasures to address the VTC actuator rattle over time, “there were actual lapses of time between when Honda believed it solved the VTC actuator rattle with the operative countermeasure and when Honda once again learned vehicles were continuing to exhibit the VTC actuator rattle in the market” (ibid.). And because class plaintiffs purchased their vehicles at varying times throughout, the argument goes, whether Honda had knowledge about the VTC actuator rattle depends on when each plaintiff purchased their class vehicle.

Our prior order denying reconsideration of class certification clarified that “this order finds our record contains common evidence going to Honda's knowledge of a safety defect.” Quackenbush v. Am. Honda Motor Co., Inc., 2022 WL 1240866, at *6 (N.D. Cal. Apr. 27, 2022). Recall our order certifying the classes already found that “the R44 pin defect remained more than ‘substantially similar[ ]' over time” such that “[d]ifferences in Honda's knowledge of the precise mechanism of the pin malfunction do not affect Honda's knowledge about premature disengagement. While Honda ‘intended' for each countermeasure to permanently end the rattle, such belief would not necessarily defeat class certification.” Quackenbush v. Am. Honda Motor Co., Inc., 2021 WL 6116949, at *5 (N.D. Cal. Dec. 27, 2021). Our order denying reconsideration made clear that defendant's arguments as to the 2011 Honda study and vehicle repair requests “go to weight,” since “the defect remained the same during the class period, making the 2011 study applicable to all class vehicles.” 2022 WL 1240866, at *4-6. That study and the three tests Honda used to understand the VTC actuator rattle featured heavily at trial as evidence relevant to defendant's common knowledge of the alleged defect.

At bottom, the glibness of defendant's argument is self-evident: defendant argues that Honda's knowledge of the defect becomes variable when Honda “believed it solved the VTC actuator rattle” (ibid. (emphasis added)). The argument conflates Honda's knowledge of the VTC actuator rattle with a determination on the merits for whether that rattle is a defect. Just because Honda believed (maybe) the rattle would no longer manifest (maybe) does not mean that the jury had to find Honda did not know the inherent design was defective such that other (or identical, as it turns out) problems could manifest. Given the six countermeasures Honda employed, and the years-long study of the VTC actuator rattle before our class period even began, there was enough common proof as to whether Honda knew about the alleged defect, which remains sufficient to sustain the certified classes. Defendant's motion to decertify the classes is DENIED.

2. Defendant'S Motion for Judgment as a Matter of Law.

Defendant moved for judgment as a matter of law before the action was submitted to the jury (Dkt. No. 357). That motion was not ruled on before submission to the jury, so pursuant to Rule 50(b) it is DENIED AS MOOT. Defendant then filed a renewed motion for judgment as a matter of law and alternatively for a new trial (Dkt. No. 382). Defendant argues it is entitled to judgment as a matter of law on the Illinois class claim because: (1) plaintiffs failed to establish a safety hazard; (2) because some class members did not suffer actual loss, and; (3) because there is insufficient evidence that each and every Illinois class member was deceived by a communication from Honda.

A. Safety Hazard.

The relevant law in California differed from the relevant law in Illinois. In California, the defect had to go to safety or to central functionality. See Hodsdon v. Mars, Inc., 891 F.3d 857, 860 (9th Cir. 2018). Honda prevailed under this standard. In Illinois, however, the law was more generous to consumers. In Illinois, the defect had to be material to consumers. See Toulon v. Cont'l Cas. Co., 877 F.3d 725, 739-40 (7th Cir. 2017). Honda wants to equate the two, but they are explicitly different. Honda lost under the Illinois law and the obvious reason is that our jury found that the grinding rattle, which was admittedly a defect, would have been material to Illinois consumers. It's as simple as that.

To repeat, defendant's argument is misplaced because Illinois law - unlike California law - is not limited to the two avenues of unreasonable safety hazard or unreasonable risk to central functioning. “A material fact exists where a buyer would have acted differently knowing the information, or if it concerned the type of information upon which a buyer would be expected to rely in making a decision whether to purchase.” Connick v. Suzuki Motor Co., 675 N.E.2d 584, 595 (Ill. 1996). True, our order certifying the class stated that “a safety hazard is subject to common proof” which was sufficient to certify both class claims under different state laws. 2021 WL 6116949, at *6. But that is precisely because the same evidence plaintiffs presented as showing a safety hazard likewise supports materiality of the alleged defect under Illinois law: “Plaintiffs have presented some evidence to suggest that a faulty chain could cause engine failure. This order does not credit that theory as true, merely acknowledges that it represents the key common question, and that it remains subject to resolution in one fell swoop.” Ibid.

Defendant suggests that “extrinsic evidence in the form of consumer surveys or market research” is necessary whenever materiality is in doubt (JMOL Reply 4-5, Dkt. No 392 (citation omitted)). However, defendant's cited decision concerned a deceptive labeling claim on summary judgment, for which the plaintiffs “ha[d] not gone beyond the pleadings” and “offered no evidence that the products fell short of consumers' expectations in any material way.” Beardsall v. CVS Pharmacy, Inc., 953 F.3d 969, 976 (7th Cir. 2020). By contrast, here evidence was presented at trial showing Honda's own years-long investigation into the VTC actuator rattle based on problems consumers were having. Illinois class representative Marissa Feeney likewise testified at trial how she “had a feeling that it was a part problem and not just a wear-and-tear problem” (Tr. Aug. 23, 2023, at 433-35, Dkt. No. 363). “The standard for materiality under the ICFA is an objective standard.” Cirone-Shadow v. Union Nissan of Waukegan, 955 F.Supp. 938, 944 (N.D. Ill. 1997) (Judge Charles P. Kocoras). The common question therefore is not whether each and every consumer subjectively believed the omission to be material, but whether a reasonable...