OK , what you have is in the Inner Cartridge , where the Valving is , is a seal , that seal has gone bad (its a common occurrence) , the oil in the Inner Chamber is now bleeding out into the main Outer Chamber/fork tube .... The only way to remedy this is to disassemble the Inner Cartridge and replace the seal , it is a tedious project , but if you have decent mechanical skills I can walk you thru the process if you wish to undertake it , if not , the only option is a Suspension Shop (not sure I would want a Dealer to do this as most of the Dealer mechanics are not suspension tech's , and have most likely never done it , and they would charge a arm and both legs to do it, and most likely do it wrong) , so you would be better off finding a local Suspension Shop and have them do it , the seal itself is about $20 , and if one has gone , the other side will soon , so its best to do both , that way its done and over with , so $40-$45 for the seals , then Labor to replace them
Unfortunately , that is the only way , unless you want to replace the Fork Cap Assembly , which from Honda is about $90
It is part # 15 on this list
http://fiche.worldofpowersports.com/yel ... 20ABSORBER
The actual seal is located within that part, so all you would have to do is remove the old one , fill the chamber with the correct amount of Fork Oil (in your case it would be 192cm/cc or 6.6 oz.) , then bleed it and reassemble everything and you're done
The seal (your Cap Assembly may vary slightly from this picture) will be where the arrow is in this picture (it will be inside the Piston , its not the O-Ring on the outside)
If you would like a walk thru on the replacement , let me know , I will guide you thru it ,if its too much to take on , then do the shop as I suggested , If you choose to do it you will need some specialty tools (I made mine) to do this
Special Holder Wrench:
These help as well , (I ground a round groove so it holds the shaft easier , if you do not want to make the Special Holder Wrench , but it does not work as well as the wrench does)
I also took a 13mm Open End Wrench and ground the head down thinner , so its not as wide to fit in between the Pressure Spring
If you have the Honda Owners Manual , it will not show you the bleeding process , and even the Factory Honda Service Manual will not show you how to disassemble the Fork Cap Assembly to replace the seal , but it will at least show you how to bleed the Cartridge