Oct. 15, 2012 – A class action settlement that would require Visa, MasterCard and some of the largest U.S. banks to pay an estimated $6.05 billion to retailers has been rejected by a majority of the plaintiffs in the case.
The plaintiffs indicated Friday they intend to oppose the settlement. The same day, the final terms of the settlement were scheduled to be submitted by the defendants to the U.S. District Court for the Eastern District of New York.
With class actions, affected parties have time to oppose the settlement before it is final. The class in this suit includes some 7 million merchants, and they must confirm they wish to remain in the class before the agreement can be finalized. If approved, the settlement would be the largest in history.
The settlement, which was announced in July
, followed a seven-year legal battle between the parties. Retailers allege that the two largest payment networks colluded with banks to maintain higher credit card interchange fees. The suit sought compensation for alleged overcharges.
Under the terms of the settlement, Visa and its banks pay two-thirds and MasterCard and its banks pay one-third of the $6.05 billion upfront to class members. In addition, the companies would be required to shave interchange fees for eight months and allow merchants to assess a surcharge on credit card transactions.
NAFCU will continue to monitor the case for any impact on credit unions.