Moore v. American Honda Motor Co., Inc.

Background

This putative class action concerns an alleged defect in the software programming or calibration of the 9-speed ZF 9HP automatic transmission in certain Honda vehicles. The alleged defect caused symptoms including rough, delayed, sudden, or failed shifting; grinding or other loud noises; harsh gear engagement; sudden acceleration or deceleration; and sudden loss of power.

The operative Consolidated Amended Complaint asserted claims under California, South Carolina, Texas, Illinois, and Ohio law, as well as claims under the federal Magnuson-Moss Warranty Act. The claims included consumer-protection claims, express- and implied-warranty claims, and a common-law fraudulent-omission claim. The plaintiffs also sought equitable relief, including restitution and prospective injunctions.

The plaintiffs included Kevin and Anita Moore, Tony Boatwright, Chuen Yong, Thomas and Julie DeSilvia, and Mark Treleven. The court considered the factual allegations as true for purposes of the motion to dismiss. The court also noted that the related litigation had previously produced rulings addressing similar claims and that the related case had been consolidated under this case.

Legal standard

American Honda moved under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint contains enough factual allegations to state a legally sufficient claim. The court accepted well-pleaded facts as true and viewed them in the plaintiffs’ favor, but it did not accept conclusory statements or unreasonable factual inferences. A claim had to be plausible on its face. The court also considered whether amendment would be appropriate under the factors identified in Foman v. Davis, including repeated failure to fix deficiencies and whether amendment would be futile.

Rulings on express-warranty claims

The court dismissed Count 4, the California express-warranty claim brought by the Moores, without leave to amend. The court found that although the Moores presented their vehicle to a dealership twice, they received a transmission replacement during the second visit. The court also found that the vehicle had approximately 71,000 miles when the problem was reported, while the written warranty covered transmission repairs for five years or 60,000 miles, whichever came first.

The court denied dismissal of Counts 8 and 10, the Illinois and Ohio express-warranty claims. The allegations concerning the DeSilvias and Treleven were sufficient to allow an inference that American Honda had refused to repair their vehicles. The allegations stated that the vehicles were presented for repair at least twice, the dealerships identified no problem, and no repair was performed.

Rulings on implied-warranty claims

The court dismissed Count 3, the California implied-warranty claim, with leave to amend. The written warranty limited implied warranties to the written warranty’s duration, and the Moores reported the problem after the vehicle had exceeded 60,000 miles. The court did not decide the broader legal dispute among federal courts about latent defects and California’s implied-warranty time limits because the complaint’s general assertion that the defect was present in every class vehicle at the time of sale was conclusory. The plaintiffs could amend to allege additional facts showing that the defect was inherent.

The court dismissed Count 9, the Illinois implied-warranty claim, without leave to amend. Under the court’s understanding of Illinois law, privity of contract—meaning a direct contractual relationship—was required to recover economic damages for breach of an implied warranty. The DeSilvias bought their vehicle from a dealership rather than American Honda, and the complaint did not adequately allege an applicable exception.

The court dismissed Count 11, the Ohio implied-warranty claim, without leave to amend. The claim sounded in contract, and Ohio law required privity with the seller. Treleven bought his vehicle from a dealership rather than American Honda, so the complaint did not adequately allege the required relationship.

Magnuson-Moss Warranty Act claims

The court dismissed Counts 13 and 14, the federal express- and implied-warranty claims under the Magnuson-Moss Warranty Act, with leave to amend only if the plaintiffs wished to add enough named plaintiffs to reach 100. The complaint named seven plaintiffs. The court held that the Act’s specific federal-court requirements include at least 100 named plaintiffs for a class action and that the Class Action Fairness Act could not be used to avoid that requirement.

Consumer-protection and fraud claims

The court dismissed Count 12, Treleven’s Ohio Consumer Sales Practices Act claim, without leave to amend. The court held that the claim was barred by Ohio’s absolute two-year limitations period because Treleven purchased the vehicle on September 14, 2016, more than two years before the action was filed.

The court dismissed Count 7, the Illinois Consumer Fraud and Deceptive Business Practices Act claim, with leave to amend. The complaint alleged that the DeSilvias visited dealership and manufacturer websites and spoke with a dealership sales representative, but it did not identify specific communications in which American Honda omitted material information. The plaintiffs could amend to identify specific statements from which material information was omitted.

The court dismissed Count 15, the common-law fraudulent-omission claim, with leave to amend. The complaint did not identify which state’s law governed that claim, and the court stated that the differences among state laws prevented it from evaluating whether the claim was adequately pleaded without that information.

Equitable relief

The court dismissed Counts 1 and 2 and the requests for equitable relief under Counts 7, 12, 13, and 14 without leave to amend. The complaint did not allege that the plaintiffs lacked an adequate remedy at law, meaning that money damages would not be sufficient. The court found that the plaintiffs had previously been made aware of this deficiency and had not added facts addressing it.

Disposition

The court granted American Honda’s partial motion to dismiss with leave to amend in part, without leave to amend in part, and denied it in part. Counts 1, 2, 4, 9, 11, and 12 were dismissed without leave to amend. Counts 3, 7, 13, 14, and 15 were dismissed with leave to amend for the specified purposes. The motion to dismiss Counts 8 and 10 was denied. The plaintiffs could file an amended complaint consistent with the order within 30 days, subject to a reasonable stipulation or motion for an extension.