Honda Motor Co., Ltd. (HMC) Failed to Disclose the Flaws in its Idle Stop Safety Feature
A shareholder filed a class action on behalf of all purchasers of Honda Motor Co., Ltd. (NYSE: HMC) American Depository Shares (“ADSs”) between June 20, 2018 and September 28, 2022, for violations of the Securities Act of 1934. Honda is a multinational conglomerate manufacturer of automobiles, motorcycles, and power equipment. The Company’s U.S.-based operations are conducted through its North American subsidiary, American Honda.
According to the complaint, during the class period, defendants touted the safety of its Idle Stop technology, including that it is an “advanced safety feature[] to assist and help protect you and your most precious cargo.” However, defendants failed to disclose that Honda had overstated the safety and effectiveness of its Idle Stop engine feature and therefore, maintained deficient disclosure controls and procedures with respect to product quality and safety. As a result, Honda failed to prevent American Honda from marketing and selling thousands of vehicles that contained defective features, which subjected the Company to a heightened risk of litigation, and financial and reputational harm.
On September 28, 2022, consumers filed a class action against American Honda alleging it the Idle Stop system routinely fails to restart engines as designed, leaving drivers unable to move their vehicles, and that American Honda was aware of the defect before marketing the vehicles. On this news, Honda’s ADS price fell over 3%, to close at $22.19 per ADS on September 29, 2022.
What Now: Similarly situated shareholders may be eligible to participate in the class action against Honda. Shareholders who want to act as lead plaintiff for the class must file their papers by April 3, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
