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Preston v. American Honda Motor Company, Inc.

United States District Court, N.D. Illinois, Eastern Division

November 2, 2017

MICHAEL PRESTON, Individually and on Behalf of All Others Similarly Situated, Plaintiff,


          Harry D. Leinenweber, Judge United States District Court

         Plaintiff Michael Preston (“Preston”) brings this putative class action against Defendant American Honda Motor Company, Inc. (“Honda”) alleging breach of express warranty, breach of implied warranty, violation of the Magnusson-Moss Act, 15 U.S.C. § 2301 et seq., and violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 Ill. Comp. Stat. 505/1 et seq. (the “ICFA”). Before the Court is Honda's Motion to Dismiss or, in the Alternative, to Transfer Venue [ECF No. 13]. For the reasons stated herein, the Court grants the Motion to Transfer.

         I. BACKGROUND

         “What's my problem? First of all, I'm a rat. Which means, life is hard. Second, I have a highly developed sense of taste and smell.” Remy, Ratatouille, Disney Pixar Films (2007).

         A. Factual Allegations

         On June 23, 2015, Preston leased a 2015 Honda Accord from an authorized Honda dealer in Illinois. (ECF No. 1 (“Compl.”) ¶¶ 7, 30-31.) Written warranties accompanied the lease, including a three-year or 36, 000-mile new vehicle limited warranty (the “NVLW”). The NVLW warrants that Honda “will repair or replace any part that is defective in material or workmanship under normal use.” (Id. ¶¶ 9, 12.) However, it does not cover “[n]ormal wear or deterioration of any part” or “acts of nature.” (ECF No. 14 (“Def.'s Mem.”) at Ex. 3.)

         Around November 2016, Preston experienced a complete loss of power steering while operating his Accord. (Compl. ¶¶ 13, 14.) After taking the car to a Honda-authorized service center for diagnosis, “he discovered that the Accord's electrical wiring, which Honda had covered with soy-based material, had been chewed and/or eaten.” (Id. ¶ 15.) Despite the fact that neither three years nor 36, 000 miles had elapsed, Honda refused to cover the repairs under the NVLW. (Id. ¶ 16.) Instead, it “simply re-installed more soy-based insulated wiring at Plaintiff's cost.” (Id. ¶ 21; see also, Id. ¶ 23.)

         Preston contends that Honda deliberately chose to insulate the wiring in certain of its more recent model-year Accords with a biodegradable soy-based compound, instead of traditional insulation, despite knowing that the former is particularly appetizing to rodents and other critters. (Compl. ¶¶ 17-18.) By gnawing on the soy-based insulation, these rodents expose the underlying wiring and can allegedly induce vehicle malfunctions of the sort Preston experienced. (Id. ¶ 2.) The gravamen of Preston's suit is thus that Honda's manufacture of the Accords in question with soy-based wiring and subsequent failure to cover repairs violates state and federal warranty law. (Id. ¶¶ 23-26.) Suing on behalf of a class of similarly situated Illinois residents, Preston also alleges that Honda's conduct amounts to a violation of the ICFA.

         B. Earlier-Filed Cases

         Preston is not the first plaintiff to challenge Honda's use of soy-based insulation in its vehicles' electrical wiring. In Dobbs v. American Honda Motor Co., No. 16 C 456 (C.D. Cal. dismissed June 2, 2016), the plaintiffs were lessees of 2012-15 model year Honda vehicles manufactured with electrical wiring coated with soy-based insulation. They alleged that this material attracts rodents and other animals who chew through the insulation and electrical wires, challenging Honda's decision to refuse to cover the required repairs as a violation of the state consumer protection statutes of the named plaintiffs' respective states, breach of Honda's express warranty, breach of the implied warranty of merchantability, and violation of the federal Magnusson-Moss Warranty Act. However, the plaintiffs voluntarily dismissed their claims without prejudice despite having fully briefed Honda's motion to dismiss before the presiding judge, Judge Manuel Real. (See, ECF No. 23 (“Def.'s Reply”) at Ex. 4.)

         Similarly, in McKown v. American Honda Motor Co., No. 17 C 204 (C.D. Cal. dismissed July 11, 2017), the plaintiffs alleged that two pre-owned Accords, which they had purchased in 2016 from Kansas dealerships, “were rendered inoperable due to rodents chewing through wiring in the fuel lines and the transmission harness.” Id., ECF No. 47, slip op. at 2. Honda told the plaintiffs that the damage was not covered under warranty and charged them for the repairs. Ibid. The plaintiffs brought claims, inter alia, for violation of the Magnusson-Moss Warranty Act, breach of implied and express warranty under California and Kansas state law, and violation of California and Kansas consumer protection law. Just prior to (and indeed on the same day as) Judge Real's July 11, 2017 order dismissing these claims for failure to give Honda fair notice, the McKown plaintiffs filed a notice of voluntary dismissal. (See, Def.'s Reply at Ex. 2.)


         Honda moves to dismiss Preston's Complaint for failure to state a claim or, in the alternative, to transfer the case to the Central District of California. The Court need not test the legal sufficiency of Preston's Complaint because it finds the case suitable for transfer to a court that is familiar with the facts and law underlying this case, and thus better situated to decide Honda's Motion to Dismiss.

         Section 1404(a) provides for transfer of “any civil action to any other district or division where it might have been brought” for “the convenience of parties and witnesses, and in the interest of justice.” 28 U.S.C. § 1404(a). The decision to transfer venue is a discretionary one, requiring the Court to exercise “a large degree of subtlety and latitude” in balancing a number of factors for and against transfer. Coffey v. Van Dorn Iron Works, 796 F.2d 217, 219 (7th Cir. 1986); see also, Research Automation, Inc. v. Schrader-Bridgeport Int'l, Inc., 626 F.3d 973, 977-78 (7th Cir. 2010). The moving party bears the burden of demonstrating that the transferee district is “clearly more convenient.” Coffey, 796 F.2d at 219-20.

         To transfer an action to another venue, the district court must find that: (1) venue is proper in the district where the case was brought; (2) venue and jurisdiction are proper in the transferee district; (3) the transferee district is more convenient for both the parties and witnesses; and (4) transfer would serve the interest of justice. Rosen v. Spirit Airlines, 152 F.Supp.3d 1055, 1059 (N.D. Ill. 2015) (citation omitted); see also, Research Automation, 626 F.3d at 977-78.

         Neither party disputes the propriety of venue in this District. (See, e.g., Compl. ¶ 4-6; Def.'s Mem. at 11.) With respect to the second factor, jurisdiction and venue are proper in the Central District of California. Honda's headquarters and principal place of business are in Torrance, California (see, ECF No. 15 (“Oborny Decl.”) ¶¶ 2-8), which is situated within the Western Division of the Central District of California. See, Jurisdiction Map for the Central District of California, available at (last visited Oct. 13, 2017). Ergo, Honda is subject to personal jurisdiction there. Accepting Preston's allegations as true yields the conclusion that that District would also have subject matter jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2). (See, Compl. ¶ 4.) Venue is similarly proper in that District because, as recited throughout Preston's Complaint, a substantial part of the events and omissions giving rise to his claims occurred at Honda's headquarters. 28 U.S.C. § 1391(b). Satisfied with the first two venue transfer conditions, the Court proceeds to balance the various factors governing convenience of the parties and witnesses as well as the interest of justice.

         A. Convenience of the Parties and Witnesses

         Evaluating the convenience of one venue over another involves consideration of four factors: (1) the plaintiff's choice of forum; (2) the situs of material events; (3) the relative ease of access to sources of proof; and (4) the convenience of the parties and witnesses. Research Automation, 626 F.3d at 978. The Court takes each of these in turn and concludes, after considering them all, that they ...

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