Honda in court trouble over hybrid fuel efficiency

TORRANCE, Calif.—A Los Angeles woman who says her hybrid Honda Civic hasn’t lived up to its high-mileage promises and wants the automaker to pay for not delivering the 21 kilometres per litre (kpl) it promised.

But rather than being one of thousands in a class-action lawsuit, she’s taken her case to small claims court.

Experts say Heather Peters has a better chance of winning her case in a court with more relaxed standards and could get a payout many times higher than the few hundred dollars offered to class-action plaintiffs.

Peters says she's been contacted by hundreds of owners who also want to take their chances with small-claims, where there are no attorneys' fees and cases are decided quickly.

“If I prevail and get $10,000, they have 200,000 of these cars out there,” she says.

Peters, a state employee and ex-lawyer, argues that Honda knew her car wouldn't get the fuel efficiency it advertised before a judge in Torrance, where American Honda Motor Co. has its West Coast headquarters.

As her 2006 vehicle's battery deteriorated over time, it barely got 13 kpl, she said.

But Honda says the $10,000 claim is excessive.

Neil Schmidt, a technical expert for Honda, says the U.S. federal government required Honda to post the highest mileage the car could get, but says fuel efficiency varies depending on how the car is driven—for instance, if it gets stuck often in stop-and-go traffic.

Peters said she would have never purchased the car if she had known that.

“The sales force said 50 miles per gallon, but they didn't say if you run your air conditioning and you remain in stop-and-go traffic, you're going to get 29 to 30 miles per gallon,” she says. “If they did, I would have gotten the regular Civic.”

If other Civic owners follow her lead, Honda could be forced to pay damages topping $2 billion.

Peters opted out of a series of class-action lawsuits filed on behalf of Honda hybrid owners over the cars' fuel economy 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.

Honda sold about 200,000 of the cars over the period covered by the settlement.

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.

“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.”

Honda said in a statement that Peters never contacted Honda to complain or express any concern about her vehicle's fuel economy until she sent a letter in late November 2011 and then filed her suit shortly thereafter.

Honda says it offered to inspect the vehicles and work with Peter on the findings once the suit was filed, but those offers were rejected.

The company also says it doesn’t believe it deceived Peters.

“The window sticker that was attached to her vehicle (as required by federal law) clearly indicated that her mileage would vary depending on driving conditions, options, vehicle condition and other factors,” it says.

Superior Court Commissioner Douglas Carnahan hasn’t issued an immediate ruling in Peters' case, but his staff said he would rule this week.