Visa-MasterCard Interchange Fee Class Action Settlement Notice

Visa-MasterCard Interchange Fee Class Action Settlement Notice

By Sarah Pierce

A federal court has ordered a notification program about the preliminary approval of the $6 billion Visa-MasterCard “swipe” fee settlement granted last summer. Merchants included in the class action lawsuit settlement will have until May 28, 2013 to object or ask to be excluded. Those that wish to remain in the settlement will have the opportunity to pre-register to expedite the claim payment process.

The proposed merchant credit card fee settlement will resolve an antitrust case alleging that Visa, MasterCard and 13 of the country’s largest banks conspired to fix merchants’ fees for accepting credit cards, also known as “interchange” or “swipe” fees. The class action lawsuit alleged the collusion resulted in a monopoly that forced merchants for years to pay higher and higher fees to process customer credit card transactions, ultimately driving up costs for consumers.

Visa, MasterCard and the banks, including JPMorgan Chase, Bank of America, Citibank, Wells Fargo, Capital One, Citigroup, HSBC and others, deny the allegations but have established a class action lawsuit settlement fund of $6.05 billion to pay approximately 7 million merchant claims.

The settlement will also require Visa and MasterCard to change some rules for merchants who accept their cards, including allowing merchants to do the following:

• Charge customers an extra fee if they pay with Visa or MasterCard credit cards.
• Offer discounts to customers who pay with payment forms less expensive than Visa or MasterCard credit or debit cards.
• Accept Visa or MasterCard cards at fewer than all of the merchant’s trade names or banners.
• Form “buying groups” that meet certain criteria to negotiate with Visa and MasterCard.

In addition, Visa and MasterCard will reduce interchange fees paid by merchants over an eight-month period while the new rules are implemented. The value of these reduced “swipe” fees is estimated at approximately $1.2 billion, and should result in lower prices for consumers.

Class Members of the Visa-MasterCard interchange fee class action lawsuit settlement include any person, business or other entity that accepted Visa or MasterCard credit or debit cards in the U.S. at any time between January 1, 2004 and November 28, 2012.

Class Members that do not exclude themselves and file a valid Claim Form will be able to participate in two settlement funds.

Cash Settlement Fund: Merchants that file a valid Claim Form will receive a portion of the $6.05 billion class action lawsuit settlement fund. This fund will be reduced based on how many merchants exclude themselves, in an amount not to exceed 25%. The amount of money you will receive from the Cash Settlement Fund will be based on the actual or estimated interchange fees you paid on Visa and MasterCard transactions from January 1, 2004 through November 28, 2012.

Interchange Fund: Every merchant that participates in the Cash Settlement Fund and accepts Visa or MasterCard credit cards during an eight-month period starting by July 29, 2013 will receive money from the Interchange Fund. The money for this fund is estimated to be up to $1.2 billion. Merchants participating in this fund will receive the equivalent of 10 basis points (i.e.; one-tenth of 1%) of their Visa and MasterCard transaction volume during this eight-month period.

A Final Fairness Hearing is scheduled for September 12, 2013. If the court grants final approval of the interchange fee class action settlement, Claim Forms will be sent to all known Class Members. Claim Forms will also be made available at www.PaymentCardSettlement.com.

Beginning January 28, 2013, Class Members with more than one location or a franchise that accepts Visa or MasterCard cards may also fill out a pre-registration form at www.PaymentCardSettlement.com. You do not have to pre-register but doing so may be helpful, and does not impact your rights in this case.

More information about your rights in the Visa-MasterCard Interchange Fee Class Action Lawsuit Settlement can be found at www.PaymentCardSettlement.com

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UPDATE: On Dec. 1, 2016, merchants seeking to wrap up a credit card swipe fee class action settlement are appealing their case to the U.S. Supreme Court.

UPDATE 2: June 2018, Visa and MasterCard are approaching a settlement deal over a swipe fee class action lawsuit after more than a decade of litigation. The settlement amount is estimated to be around $6.5 billion and is expected to be reached by mid-July.

UPDATE 3: On Sept. 18, 2018, Visa, MasterCard, and numerous banks including Bank of America, Barclays, JPMorgan Chase, Citibank, and SunTrust Bank, have reached a new $6.2 billion settlement deal to resolve a massive antitrust swipe fee multidistrict litigation.

UPDATE 4: On Jan. 24, 2019, a New York federal judge preliminarily approved a massive Visa, Mastercard swipe fee settlement, which would add an additional $900 million for merchant Class Members.

UPDATE 5: March 2019, a settlement website has recently been established for Class Members in the Visa, Mastercard swipe fee class action lawsuit. While Claim Forms are not currently available, the website provides an opportunity for Class Members to pre-register to receive one.

Updated January 28th, 2013

All class action and lawsuit news updates are listed in the Lawsuit News section of Top Class Actions