Woman sues Honda in unlikely place: small claims

TORRANCE, Calif. — A woman who expected her Civic Hybrid to be her dream car wants Honda to pay for not delivering the 50 mpg it promised.

But rather than joining other owners in a class-action lawsuit, Heather Peters is going solo against the automaker in small-claims court, an unusual move that could offer a bigger payout. And if successful, it could open the door to a flood of similar lawsuits.

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

Peters, a former lawyer, says that as her vehicle’s battery deteriorated, it got only 30 mpg.

When Honda ignored her complaints, she filed legal papers seeking reimbursement for her trouble and the extra money she spent on gas. The suit could cost the company up to $10,000.

If other Civic owners follow her lead, she estimates Honda could be forced to pay as much as $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."

Small claims courts generally handle private disputes that do not involve large amounts of money. In many states, that means small debts, quarrels between tenants and landlords and contract disagreements.

A victory for Peters could encourage others to take the same 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 would start a groundswell of similar cases. He suggested that few people would want to spend 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 Honda hybrid owners when she saw a proposed settlement would give plaintiffs 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."

Typical limits in other states range from $2,500 to $15,000.

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."

She said she also sent emails to top executives at Honda but got no response. She also launched a website, DontSettleWithHonda.org, urging others to take their complaints to small-claims court.

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 lawyers’ fees. Jacoby said class-action lawyers do extensive work that involves many clients and sometimes spans years. And they are not in it just for money.

"They’re representing the underdog, and they believe they are performing a public duty," he said. "Many of these people could not get lawyers to represent them individually."

The judge hearing Peters’ case was not expected to make an immediate ruling Tuesday, but small claims matters are usually decided much faster than those in civil courts, which often take years to resolve major cases.

American Honda’s offices were closed for the holidays, and no one could be reached for comment. Peters said the company has tried five times to delay the trial but was rebuffed.

The upside of Peters’ unusual move, she says, is that litigants are not allowed to have lawyers argue in small-claims court in California. That means any award would not be diluted by attorney’s fees. Honda would have to appoint a non-lawyer employee to argue its side in court.

"If I prevail and get $10,000, they have 200,000 of these cars out there," she said.

A judge in San Diego County is due to rule in March on whether to approve Honda’s latest class-action settlement offer. Members of the class have until Feb. 11 to accept or decline the deal.

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