A consumer lawsuit against Mastercard in the U.K. got approval to move forward after a court reversed a ruling by the Competition Appeal Tribunal.
According to a report in the Financial Times, the U.K. Court of Appeal rejected the tribunal's ruling from 2017, which had blocked the claimants from pursuing the case led by Walter Merricks, the former financial ombudsman. Merricks is seeking £14bn from Mastercard on behalf of 46 million consumers in the U.K. The lawsuit contends the consumers suffered due to fees Mastercard charged them.
"I am very pleased with today’s decision,” Merricks told the news outlet. “It is nearly 12 years since Mastercard was clearly told that they had broken the law by imposing excessive card transaction charges, damaging consumers over a prolonged period.”
The lawsuit contends Mastercard's interchange fees – the fees it charges for cross-border payments – were a big cost to retailers, which they then passed on to consumers in the form of higher prices. First launched in 2016, the lawsuit was borne out of the collective action rule that was introduced in 2015. Under that rule, consumers are allowed to sue for collective damages on behalf of people harmed under the competition laws, the report noted.
The ruling on Tuesday (April 16) doesn't mean the suit can go forward, as it still needs certification before a trial can proceed. Mastercard plans to appeal to the Supreme Court. In a statement to the Financial Times, the payments company said the decision isn't a final ruling, and that the court has decided a rehearing is necessary on some of the issues.
“Mastercard continues to disagree fundamentally with the basis of the claim, and we believe U.K. consumers receive real value from the security, convenience and consumer protection of our payment services,” the company said.