A federal appeals court threw out the previous approval of a antitrust settlement that had been reached Visa and MasterCard with millions of retailers. In addition, the court decertified the case as a class action.
The three-judge panel unanimously struck down the settlement, stating that the agreement was unfair to retailers that stood to receive no payments and, in the court’s view, little or no benefit at all.
The settlement was reached in December 2013 after a decade of litigation brought on behalf of about 12 million retailers against Visa, MasterCard and the banks that issue their cards. The settlement had called for retailers that accepted Visa or MasterCard from January 2004 – November 2012 to share in as much as $7.25 billion. Retailers that started accepting cards after November 2004 were to receive inuunctive relief in the form of rule changes. American Express and Discover were not part of the litigation nor the settlement
It had been the largest all-cash U.S. antitrust settlement, through the value shrank to under $6 billion after thousands of retailers “opted out.”
Retailers started accepting cards after November 2004 were to receive injunctive relief in the form of rule changes.
The case now returns to Brooklyn federal court, where it will be overseen by U.S. District Judge Margo Brodie. The settlement will now need to be renegotiated, or the case could go to trial. The next formal action will be a conference/hearing set for August 11, 2016, with all parties representing the plaintiffs and defendants.
OMEGA Processing Solutions will continue to monitor the legal proceedings and keep our merchants informed of the case’s progress.