FAQs: 

This lawsuit is principally about the interchange fees attributable to merchants that accepted Visa or Mastercard credit or debit cards between January 1, 2004 and January 25, 2019, and Visa’s and Mastercard’s rules for merchants that have accepted those cards.

The Rule 23(b)(3) Class Plaintiffs claim that:

    Visa, and its respective member banks, including the Bank Defendants, violated the law because they set interchange fees.

    Mastercard and its respective member banks, including the Bank Defendants, violated the law because they set interchange fees.

    Visa and its respective member banks, including the Bank Defendants, violated the law because they imposed and enforced rules that limited merchants from steering their customers to other payment methods. Those rules include so-called no-surcharge rules, no-discounting rules, honor-all-cards rules, and certain other rules. Doing so insulated them from competitive pressure to lower the interchange fees.

    Mastercard and its respective member banks, including the Bank Defendants, violated the law because they imposed and enforced rules that limited merchants from steering their customers to other payment methods. Those rules include so-called no-surcharge rules, no-discounting rules, honor-all-cards rules, and certain other rules. Doing so insulated them from competitive pressure to lower the interchange fees.

    Visa and Mastercard conspired together about some of the business practices challenged.

    Visa and its respective member banks continued in those activities despite the fact that Visa changed its corporate structure and became a publicly owned corporation after this case was filed.

    Mastercard and its respective member banks continued in those activities despite the fact that Mastercard changed its corporate structure and became a publicly owned corporation after this case was filed.

    The Defendants’ conduct caused the merchants to pay excessive interchange fees for accepting Visa and Mastercard cards.

    But for Defendants’ conduct there would have been no interchange fee or those fees would have been lower.

When a cardholder makes a purchase with a credit or debit card, there is an interchange fee attributable to those transactions, which is usually around 1% to 2% of the purchase price. Interchange fees typically account for the greatest part of the fees paid by merchants for accepting Visa and Mastercard cards.

Visa and Mastercard set interchange fee rates for different kinds of transactions and publish them on their websites, usually twice a year.

In a class action, people or businesses sue not only for themselves, but also on behalf of other people or businesses with similar legal claims and interests. Together all of these people or businesses with similar claims and interests form a class, and are class members.

When a court decides a case or approves a settlement, it is applicable to all members of the class (except class members who exclude themselves). In this case, the Court has granted Final Approval to the settlement and the class defined below in Question 6. An appeal to the final-approval order was filed on Friday, January 3, 2020. The Settlement received final approval by the district court. The Second Circuit Court of Appeals heard oral arguments and affirmed all aspects of the District Court’s final approval order save one. The time for all appeals has passed.

The Court has not decided which side was right or wrong or if any laws were violated. Instead, both sides agreed to settle the case and avoid the cost and risk of trial and appeals that would follow a trial.

In this case, the settlement is the product of extensive negotiations, including mediation before two experienced mediators, chosen by the parties. Settling this case allows class members to receive payments. The Rule 23(b)(3) Class Plaintiffs and their lawyers believe the settlement is best for all class members.

The parties agreed to settle this case only after thirteen years of extensive litigation. During discovery, Rule 23(b)(3) Class Plaintiffs reviewed and analyzed more than 60 million pages of documents and participated in more than 550 depositions, including fact and expert depositions. Also, earlier in this litigation, motions to dismiss, motions for summary judgment, motions to exclude expert testimony, and the motion for class certification had been fully briefed and argued, but not decided by the Court.

All persons, businesses, and other entities that have accepted any Visa-Branded Cards and/or Mastercard-Branded Cards in the United States at any time from January 1, 2004 to January 25, 2019, except that the Rule 23(b)(3) Settlement Class shall not include (a) the Dismissed Plaintiffs, (b) the United States government, (c) the named Defendants in this Action or their directors, officers, or members of their families, or (d) financial institutions that have issued Visa-Branded Cards or Mastercard-Branded Cards or acquired Visa-Branded Card transactions or Mastercard-Branded Card transactions at any time from January 1, 2004 to January 25, 2019.

Under the settlement, Visa, Mastercard and the Bank Defendants have agreed to provide $5.54 billion to merchants that did not exclude themselves from the Settlement Class.

Every merchant in the Rule 23(b)(3) Settlement Class that did not exclude itself from the class by the deadline, 

and filed a valid claim (“Authorized Claimant”) will be paid from the settlement fund. The money in this settlement fund will also be used to pay:

• The cost of Settlement administration and notice, and applicable taxes on the settlement fund and any other related tax expenses, as approved by the Court;
•  Money awards for Rule 23(b)(3) Class Plaintiffs for their service on behalf of the class, as approved by the Court; and
•  Attorneys’ fees and expenses, as approved by the Court.

You must file a valid claim to get money from this Settlement. The Court granted Final Approval to the settlement on December 13, 2019.

The amount paid from the settlement fund will be based on your actual or estimated interchange fees attributable to Visa and Mastercard card transactions (between you and your customers) from January 1, 2004, through January 25, 2019.

The amount of money each Authorized Claimant will receive from the settlement fund depends on the money available to pay all claims, the total dollar value of all valid claims filed, the cost of class administration and notice, applicable taxes on the settlement fund and any other related tax expenses, attorneys’ fees and expenses, and money awards to the Rule 23(b)(3) Class Plaintiffs for their representation of merchants in MDL 1720, which culminated in the Class Settlement Agreement, all as approved by the Court.

No payments are expected to be made until after the end of the Claims Period on February 4, 2025. 

Because the pro rata cannot be determined until all Claims are filed and reviewed and until the Court 

approves the final amounts, we do not yet know when payments will be made. Current expectation is Q3 or Q4 2025.