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SOUTHERN CALIFORNIA RECORD

Tuesday, June 25, 2024

Plaintiff challenges car manufacturer over arbitration clause enforcement

State Court
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In a recent legal filing, Santos Novoa lodged a petition for writ of mandate against the Superior Court of California, Los Angeles County, with American Honda Motor Co., Inc. as the real party in interest. The complaint was filed on November 20, 2023, in the Second Appellate District Division Five court. Novoa is challenging the trial court's decision to compel arbitration based on a retail sales installment contract containing an arbitration provision.

Santos Novoa's complaint alleges that American Honda Motor Co., Inc. engaged in fraudulent concealment and breached express and implied warranties under the Song-Beverly Consumer Warranty Act. Specifically, Novoa claims that Honda knowingly installed defective transmissions in various models of their vehicles, including all 2014-2019 Honda Pilot and 2011-2019 Honda Odyssey vehicles.

The case took a significant turn on March 4, 2022, when the trial court granted Honda’s motion to compel arbitration based on a "Retail installment sale Contract — simple finance charge (with arbitration provision)" between Novoa and Wier Canyon Honda, the dealership from which he purchased his 2016 Honda Pilot. Although Honda was not a direct party to this sales contract, the trial court ruled that they could enforce the arbitration clause based on precedent set by Felisilda v. FCA US LLC (2020).

Fifteen months later, citing new case law such as Ford Motor Warranty Cases (2028), which rejected Felisilda’s holding, Novoa moved for reconsideration of the order compelling arbitration. However, on September 21, 2023, the trial court denied this motion stating it lacked jurisdiction to interfere with ongoing arbitration proceedings and emphasized that Ford Motor merely presented a conflicting legal perspective rather than overruling Felisilda.

Despite these setbacks in lower courts, Novoa persisted by filing this petition for writ of mandate. The appellate court issued an order to show cause but ultimately denied the petition on grounds that Novoa has an adequate remedy through appeal if any arbitration award is confirmed. Notably, during these proceedings, Honda offered to stay arbitration pending a Supreme Court opinion in Ford Motor—a proposal declined by Novoa but renewed by Honda subsequently.

Novoa seeks relief from what he perceives as an unjust enforcement of an arbitration clause by a non-signatory party—Honda—in contradiction to evolving case law. He argues that recent judicial interpretations should invalidate prior rulings compelling him into arbitration with Honda.

Representing Santos Novoa are attorneys Roger Kirnos and Jeffrey Mukai from Knight Law Group. On behalf of American Honda Motor Co., Inc., Lisa Perrochet and John A. Taylor Jr. from Horvitz & Levy along with Julian G. Senior and Alexander A. Alarcon from SJL Law have appeared in court proceedings.

The case was presided over by Judge Thomas D. Long under Case ID B333392 at the Superior Court of Los Angeles County (Super Ct No: 20STCV407383). In denying the petition for writ of mandate while awarding costs on appeal to Novoa, Judges Kim J., Baker Acting P.J., and Moor J., concurred in their decision not to publish this opinion officially.

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