In a settlement that has been given preliminary approval by a federal court in New York, Visa and Mastercard, along with bank defendants, have agreed to provide roughly $6.24 billion in settlement funds. The funds are subject to a deduction that is said not to exceed $700 million, according to a notice authorized by the U.S. District Court for the Eastern District of New York.
According to the notice, which was released on Friday (Feb. 22), “The defendants say they have done nothing wrong and the Court has not decided who is right, but the parties have agreed to a settlement. The Court has now given preliminary approval to this settlement.” That potential arrangement stems from a class action suit that contended that that “Visa and Mastercard, separately, and together with certain banks, violated antitrust laws and caused merchants to pay excessive fees for accepting Visa and Mastercard credit and debit cards” per the notice.
Merchants can either eventually file a claim and ask for payment, object to the settlement or exclude themselves from the settlement class. Those merchants that file a valid claim and do not exclude themselves from the settlement class “will get money from the class settlement fund” if the settlement is approved, according to the announcement. A claim’s value is said to be determined by the “actual or estimated interchange fees” of a merchant’s payment transactions with Visa and Mastercard between Jan. 1, 2004 and Jan. 25, 2019. In the event that the court approves the lawsuit settlement, a deadline for claims would be set.
The notice also said that a court hearing would take place on Nov. 7 to determine if the proposed settlement is approved. In addition, the hearing “will address the requests for attorneys’ fees and expenses, and awards for the Class Plaintiffs for their representation of merchants in MDL 1720, which culminated in the settlement agreement,” according to the notice.