U.S. judge approves retail credit card fee settlement
By Andrew Longstreth
NEW YORK (Reuters) - A U.S. federal judge on Friday approved an estimated $5.7 billion class action settlement between merchants and Visa Inc (V.N: Quote) and MasterCard Inc (MA.N: Quote) over credit card fees despite objections from thousands of retailers who complained it was inadequate.
The settlement is believed to be the largest in a U.S. antitrust class action.
Merchants first sued Visa and MasterCard in 2005, accusing the two companies of fixing the fees charged to merchants each time their customers used their credit or debit cards. They were accused also of preventing merchants from steering customers to cheaper forms of payments.
U.S. District Judge John Gleeson of Brooklyn, New York, approved the settlement in a written order. He also dismissed some of the objections made by merchants opposed to the deal as hyperbole.
At a fairness hearing in September, he noted that one objector cast Visa and MasterCard as Nazis.
"I conclude that the proposed settlement secures both a significant damage award and meaningful injunctive relief for a class of merchants that would face a substantial likelihood of securing no relief at all if this case were to proceed," Gleeson wrote.
The value of the settlement, reached last year, decreased to $5.7 billion from roughly $7.2 billion after thousands of merchants opted out of the deal, according to Craig Wildfang, an attorney for the plaintiffs.
Mallory Duncan, general counsel for the National Retail Federation, which opposed the settlement, said in a statement that his organization was reviewing Gleeson's ruling and expected to file an appeal. Continued...