Federal Judge Allows Claim Based On Improper Calculation of Mileage Offset Under California’s Lemon Law
In a significant victory for one of the firm’s clients and consumers in California generally, attorneys at Strategic Legal Practices secured a ruling that allowed the client’s claim against Hyundai alleging improper calculation of her mileage offset to move forward. While the judge in the case, Judge Josephine L. Staton of the U.S. District Court for the Central District of California, granted Hyundai’s motion to dismiss various other claims, she ruled that our client should be able to seek additional compensation based on the improper calculation.
Firm founder Payam Shahian handled the case along with co-counsel.
Understanding the Mileage Offset Under California’s Lemon Law
Under California’s Lemon Law, individuals and small businesses that purchase or lease defective vehicles have three primary options: They can obtain a refund, they can obtain a replacement vehicle, or they can negotiate a cash settlement.
When a claimant accepts a refund or replacement vehicle under California’s Lemon Law, the manufacturer is entitled to what is known as a “mileage offset.” This is a credit for the amount of time (or a number of miles) that the claimant was able to drive the vehicle before it became a problem.
Manufacturers cannot simply use an arbitrary number when deducting a mileage offset. Instead, they must calculate each claimant’s mileage offset on a case-by-case basis. The formula for calculating a mileage offset under California’s Lemon Law is the product of the purchase price multiplied by the vehicle’s mileage at the time of the first repair attempt divided by 120,000 (which is the average life expectancy of a vehicle in California). So, for example:
- Purchase Price of Vehicle: $40,000
- Miles Driven Before First Repair Attempt: 5,000
- Mileage Offset Under California’s Lemon Law: ($40,000*5,000)/120,000 = $1,667
- Amount of Refund: $40,000-$1,667 = $38,333
Manufacturers Routinely Miscalculate Mileage Offsets
As you might expect, manufacturers will often try to inflate the mileage offset amount to reduce the amount they owe in California Lemon Law Cases. They may do this by either (i) attempting to impose a flat-rate deduction for “good use” of the vehicle or (ii) claiming that the first repair attempt wasn’t the first repair attempt (i.e., the owner or lessee brought the vehicle in for a different issue). While this is unfortunate and can add to the challenges of pursuing a successful claim, our attorneys can regularly help clients overcome these types of issues.
Our client alleged that the manufacturer attempted to deduct an extra $500 through an improper mileage offset calculation in the Hyundai case that Law360 initially covered. This was a significant amount of money for our client, as it is for many people, and we were proud to seek relief on her behalf.
Speak with a California Lemon Law Attorney at Strategic Legal Practices
Do you have a California Lemon Law claim? Are you struggling to assert your rights under California’s lemon law? If so, our attorneys can help. For a free, no-obligation consultation, call 888-757-5366 or get in touch online now.