On June 22, 2005, Photos Etc. Corporation, Traditions Ltd., CHS Inc., and other plaintiffs filed a class action complaint in Photos Etc. Corp., et al. v. Visa U.S.A. Inc., et al., No. 05-CV-01007 (D. Conn.), alleging, among other things, that the card networks artificially inflated interchange rates charged for credit and debit cards.
Last November 2012, Judge John Gleeson of the U.S. Eastern District of New York gave preliminary approval to a proposed $7.25 billion antitrust settlement claim against Visa and MasterCard. While this was supposed to put an end to the settlement, numerous large merchants and retail trade groups fought the settlement since it would eliminate future lawsuits against Visa and MasterCard.
On September 12, 2013, Judge Gleeson held a long awaited Visa/MasterCard settlement fairness hearing in a Brooklyn court. He heard the arguments from the proponents and opponents of the proposed settlement. He questioned both sides on their arguments and reminded them that the settlement is a compromise and neither side is likely to get everything they are seeking.
Here are key take-aways from the September 12th hearing and related news:
- Judge Gleeson didn’t say when he expected to issue a ruling…it is anticipated in the next 30 to 120 days
- Many plaintiffs and class co-counsel, Craig Wildfang, are optimistic about final approval especially since the settlement was negotiated under Judge Gleeson’s supervision and guidance
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The Visa/MasterCard settlement has been reduced to $5.74 billion given that retailers
accounting for more than 25% of the total volume of credit card purchases have decided to opt out of the settlement
Click here to read the WSJ article with more information about the hearing.