Adrian Pozos, et al. vs. American Honda Motor Co., Inc., a California Corporation

Case Background

On October 27, 2020, Plaintiff Adrian Pozos and Liliana Lopez filed a breach of warranty lawsuit against American Honda Motor Co. alleging violation of the Song-Beverly Act and fraudulent concealment. The case was filed in the California Superior Court, Los Angeles County. Judge Christopher K. Lui presided over this case. [Case number: 20STCV41226]

Cause

Defendant American Honda Motor (AHM) manufactured and sold numerous vehicles in the U.S. with defective transmissions, including the 2015-2017 Acura TLC, 2016-2017 Acura MDX, 2016-2017 Honda Pilot, and 2018-2019 Honda Odyssey models, among others.

The defect, referred to as the “9-Speed Transmission Defect,” arose from the transmission’s 9.8 ratio speed. This design aimed to provide smoother gear shifts and better fuel efficiency compared to the standard six-speed setup. The ZF9HP Automatic Transmission, using manual-like “dog clutches” activated by computer software, was compact but flawed. The software led to power cuts and delays during gear shifts, causing aggressive surges when acceleration resumed.

Drivers expected their automatic transmissions to respond predictably—starting, accelerating, decelerating, and stopping promptly with their inputs. However, vehicles with the ZF9HP transmission behaved erratically, creating severe safety risks. Symptoms included rough and delayed shifting, loud noises, harsh gear engagements, sudden acceleration or deceleration, and unexpected power loss. These issues heightened crash risks, especially in critical driving situations like merging onto highways or navigating busy intersections.

Adrian Pozos and Liliana Lopez (Plaintiffs) reasonably expected their vehicles to be free from such severe transmission issues. AHM should have known about these safety problems from pre-market testing, consumer complaints, and Technical Service Bulletins (TSBs). Despite this knowledge, AHM continued to sell and lease these vehicles without full disclosure or voluntary recalls.

By December 15, 2017, when the Plaintiffs leased the Subject Vehicle, AHM was already aware of the defects, which had been noted as early as 2014. AHM’s service bulletins addressed the transmission issues over time but failed to adequately inform consumers. Despite numerous complaints and internal knowledge, AHM concealed the defect, impacting vehicle safety and value while benefiting financially at consumers’ expense.

Damages

Under the Song-Beverly Act, Plaintiffs were entitled to a refund of the vehicle’s purchase price, minus the amount attributable to their use before presenting it to an authorized repair facility for a defect.

Plaintiffs could also recover incidental, consequential, and general damages due to American Honda’s failure to meet its obligations under the Song-Beverly Act. This included registration fees and insurance for the Subject Vehicle.

Moreover, Plaintiffs could claim a sum equal to their total costs and expenses, including attorney’s fees, incurred in initiating and pursuing the action.

In addition, Plaintiffs were entitled to a civil penalty of up to twice the amount of actual damages due to American Honda’s willful non-compliance with the Act. They could also seek replacement or reimbursement under Civil Code section 1794 and related statutes.

Plaintiffs had the right to rescind the contract under Civil Code section 1794 and Commercial Code section 2711. They could recover “cover” damages under Commercial Code sections 2711 and 2712, as well as Civil Code section 1794.

Plaintiffs sought all incidental and consequential damages as provided by Civil Code section 1794 and Commercial Code sections 2711, 2712, and 2713. They requested reimbursement for out-of-pocket expenses, including the difference in the fair market value of the Subject Vehicle and reliance damages.

Additionally, they requested incidental and consequential damages as proven at trial, a civil penalty of twice their actual damages, punitive damages, revocation of acceptance of the Subject Vehicle, prejudgment interest at the legal rate, reasonable attorney’s fees and costs of suit, and any other relief deemed just and proper by the Court.

Key Arguments and Proceedings

Legal Representation

  • Plaintiff(s): Adrian Pozos | Liliana Lopez
    • Counsel for Plaintiff(s): Roger Kirnos | Maite C. Colon
    • Experts for Plaintiff(s): Christopher Morales
  • Defendant(s): American Honda Motor Co., Inc., a California corporation | Does 1 through 10, inclusive
    • Counsel for Defendant(s): Brian Takahashi | Theodore Dorenkamp III | Scott Hancox
    • Experts for Defendant(s): James Jongkind

Claims

First Cause of Action – Violation of the Song-Beverly Act – Breach of Express Warranty: American Honda failed to address the defects and nonconformities or to issue a prompt refund as required by the Song-Beverly Act. Consequently, American Honda breached its obligations under this Act.

Second Cause of Action – Violation of the Song-Beverly Act – Breach of Implied Warranty: The lease of the Subject Vehicle included an implied warranty of merchantability under Civil Code Section 1792. However, the vehicle was delivered with hidden defects, such as a faulty transmission. This made the vehicle unsuitable for ordinary use and below the quality generally expected in the trade.

Third Cause of Action – Violation of the Song-Beverly Act Section 1793.2: The defects in the Subject Vehicle compromised its safety. Plaintiffs brought the vehicle to American Honda’s authorized service representative, Culver City Honda, multiple times for transmission repairs. Despite over thirty days having passed since the vehicle was delivered to Culver City Honda, American Honda and Culver City Honda had not returned the vehicle in compliance with their warranties.

Fourth Cause of Action – Fraudulent Inducement – Concealment: American Honda was aware of the Transmission Defect but did not disclose this information to the Plaintiffs. The defect was never made publicly available, and American Honda did not reveal it privately to Plaintiffs.

American Honda produced marketing materials, such as brochures and manuals, for its authorized dealerships to provide to consumers. These materials were intended to inform consumers about American Honda vehicles. Through these materials and dealership personnel, American Honda communicated vehicle details to consumers.

Authorized dealerships acted as American Honda’s agents in leasing and selling vehicles. While marketing brochures highlighted the Subject Vehicle’s features and 9-speed Transmission, they failed to disclose defects in the transmission. This omission rendered the disclosure misleading. American Honda actively concealed this information, preventing Plaintiffs from discovering the defects.

Defense

Under Code of Civil Procedure section 431.30, AHM denied all allegations in the Plaintiffs’ Second Amended Complaint. This included each alleged cause of action and every claim within the complaint. AHM also denied that the Plaintiffs suffered any damages as claimed or in any other amount. AHM believed and alleged that it did not make any misrepresentations or concealments of material facts. They stated that there was no intent to defraud. Furthermore, AHM believed and alleged that the Plaintiffs did not suffer any damages from any representations or concealments made by AHM, if any.

Expert Testimony

The Plaintiff’s auto expert witness was Christopher Morales while Defendant AHM retained James Jongkind as their automotive technical
expert.

Jury Verdict

On April 03, 2024, a twelve-person California jury returned a defense verdict in favor of . It was found that D gave the Plaintiffs an express written warranty, however, the vehicle did not contain any defects covered by the warranty which substantially impaired the vehicle’s safety or use. No damages were awarded.

On April 15, 2024, Judge Christopher K. Lui entered judgment consistent with the verdict.

Court Documents:

Available upon request