Heather Peters says she has been happy to answer questions, and she's curious to see how many file small-claims court cases of their own. She's not the only one.
Automakers, legal experts and consumer-rights advocates are keeping an eye on what happens in the aftermath of her victory. Every car company today must advertise fuel economy to comply with regulation. But many--Ford, Hyundai, Chevy, Toyota and Honda, for example-- regularly trumpet fuel economy ratings in an attempt to convey quality and innovation, as well as appeal to pocketbooks when gas prices spike. They'll all have a clearer idea of what they are facing from disappointed consumers and judges soon.
Civic hybrid owners from across the United States have until Saturday to follow Peters' path and opt out of a class-action lawsuit against American Honda Motor Co. Should enough of them do so, some experts believe her case could alter the way Honda handles future claims.
"At least temporarily, it's going to make a difference in how Honda deals with hybrid cases and false advertising," said David J. Farrell, an attorney who specializes in consumer rights and California's lemon laws.
The two lawsuits cover the same ground: Civic hybrids that got lower-than-advertised fuel economy and diminished further after a software upgrade for the car's battery. But rather than remain in the class-action, Peters opted out and handled her own case in small-claims court.
A commissioner in Los Angeles Superior Court awarded her $9,867.19 in damages last week. By contrast, plaintiffs in the class-action, Lockabey v. American Honda Motor Co., stand to gain $200 and a coupon off future Honda purchases. Initially hesitant about opting out of the class-action and pursuing an individual case, some Civic owners are emboldened by the judgment in Peters' case.
"The $100 I'd get amounts to a week's worth of gas," said John Lundy, who says he never got more than 37 miles per gallon from his '06 Civic hybrid instead of the 50 mpg on the window sticker. "When you consider the mpg I got, the car should have been priced accordingly. That's where I feel I've been wronged."
Opting out of class action
He has opted out of the class-action lawsuit and intends to follow Peters' lead and file a small-claims court suit in Orange County, Calif.
Honda intends to appeal the decision in the Peters case. In a written statement, the automaker said it believed the court made a "radical" departure from precedent and erred by imposing requirements more stringent than Environmental Protection Agency's mileage estimates on the vehicle.
"A Honda advertisement that accurately referenced EPA mileage estimates truthfully stated that a driver can get "up to 50 mpg" and carefully noted that the mileage will vary is not misleading," the company's statement said.
Honda declined comment on the Lockabey class action, because the litigation is ongoing.
Peters contends her 2006 Civic hybrid got far below the advertised 50 miles per gallon. At its peak, she said her car received 42 mpg on the highway. Critical in her case was demonstrating her fuel efficiency deteriorated to less than 30 mpg following the software update.
In a 26-page judgment handed down in Los Angeles Superior Court, commissioner Douglas J. Carnahan did not dispute that the vehicle is capable of reaching 50 mph, but concluded the fact that it did not in Peters' vehicle amounted to "negligent misrepresentation."
Consumer Reports disappointed in fuel economy ratings too
Consumer Reports, the nonprofit organization that examines automobiles and other products, tested the same '06 Civic hybrid model shortly after it was introduced and emerged "disappointed" with the results. The magazine reported it managed 37 mpg overall and 26 mpg in the city with the model.
Other owners shared similar stories. Greg Yi, another California resident, said he averaged 37 to 42 mpg before the battery software update and 28.6 mpg over 2,000 miles afterward. Although disappointed in the early mileage, he did not consider a lawsuit until after the software update.
"That was the stab in the heart," said Yi, who is individually suing Honda. "It may have extended the battery life, but it came at the expense of the gas mileage. They just tried to blame me. The dealer told me I needed to change the tires."
Last year, sales of the model dipped 37.1 percent from 2010, falling from 7,336 to 4,703, according to sales figures from Autodata Corp.
All U.S. customers who bought Civic hybrids in that six-year span are considered members of the Lockabey class action unless they opt out. The number of owners opting out will not be known until after the deadline passes, said Alan Mansfield, one of the attorneys representing plaintiffs in the case.
Attention is being paid to this case because there are other vehicles receiving complaints and criticism about not reaching advertised fuel economy. Some customers, media outlets have cited Hyundai Elantra, for example, for falling short of 40 mpg highway mileage. Automakers are keen to advertise the highest possible fuel economy they think they can achieve, but court cases may move companies to hedge lower in their ads.
The class-action combines similar cases from around the country and represents all eligible U.S. owners. It will be adjudicated in a San Diego County Court, where Judge Timothy B. Taylor is expected to approve the settlement in a hearing scheduled for March 16.
That outcome is not necessarily a good one for Honda owners, Farrell believes.
"For minor things that there's not really a dollar value attached to, that's OK for a class action," said Farrell, who is not representing parties associated with either case. "But in a situation like this, evidenced by this lady that won all this money, they're giving up substantial damages for nothing or very little."
Owners interested in opting out of the lawsuit must send a notice to the settlement administrator with a postmark no later than Saturday, and can get more information by calling the 1 (877) 465-4797. More information is available at hchsettlement.com.
No matter what happens in the appeal of the Peters case and the outcome of the Lockabey one, Jamie Court, president of Consumer Watchdog, an advocacy organization that has scrutinized the miles-per-gallon claims of automakers, says their impacts have already resonated.
"The car companies clearly have to do more to be more transparent and be less boasting," he said. "This is a victory for consumers and for people who want honesty in advertising."