To merchants who have accepted Visa and MasterCard
at any time since January 1, 2004:
Notice of a 6+ billion dollar class action settlement.
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Notice of a class action settlement authorized by the U.S.
District Court, Eastern District of New York.
This notice is authorized by the Court to inform you about
an agreement to settle a class action lawsuit that may affect
you. The lawsuit claims that Visa and MasterCard, separately,
and together with banks, violated antitrust laws and caused
merchants to pay excessive fees for accepting Visa and
MasterCard credit and debit cards, including by:
• Agreeing to set, apply, and enforce rules about merchant
fees (called default interchange fees);
• Limiting what merchants could do to encourage their
customers to use other forms of payment through, for
example, charging customers an extra fee or offering
• Continuing that conduct after Visa and MasterCard changed
their corporate structures.
The defendants say they have done nothing wrong. They
say that their business practices are legal and the result of
competition, and have benefitted merchants and consumers.
The Court has not decided who is right because the parties
agreed to a settlement. On November 27, 2012, the Court gave
preliminary approval to this settlement.
Under the settlement, Visa, MasterCard, and the bank
defendants have agreed to make payments to two settlement
• The first is a "Cash Fund" — a $6.05 billion fund that will pay
valid claims of merchants that accepted Visa or MasterCard
credit or debit cards at any time between January 1, 2004
and November 28, 2012.
• The second is an "Interchange Fund" — estimated to be
approximately $1.2 billion — that will be based on a portion
of the interchange fees attributable to certain merchants
that accept Visa or MasterCard credit cards for an eight-
month "Interchange Period."
Additionally, the settlement changes some of the Visa and
MasterCard rules applicable to merchants who accept their
This settlement creates two classes:
• A Cash Settlement Class (Rule 23(b)(3) Settlement Class),
which includes all persons, businesses, and other entities
that accepted any Visa or MasterCard cards in the U.S. at
any time from January 1, 2004 to November 28, 2012, and
• A Rule Changes Settlement Class (Rule 23(b)(2) Settlement
Class), which includes all persons, businesses, and entities
that as of November 28, 2012 or in the future accept any
Visa or MasterCard cards in the U.S.
WHAT MERCHANTS WILL GET
FROM THE SETTLEMENT
Every merchant in the Cash Settlement Class that files a valid
claim will get money from the $6.05 billion Cash Fund, subject
to a deduction (not to exceed 25% of the fund) to account for
merchants who exclude themselves from the Cash Settlement
Class. The value of each claim, where possible, will be based
on the actual or estimated interchange fees attributable to the
merchant's MasterCard and Visa payment card transactions from
January 1, 2004 to November 28, 2012. Payments to merchants
who file valid claims for a portion of the Cash Fund will be
• The money available to pay all claims,
• The total dollar value of all valid claims filed,
• The deduction described above not to exceed 25% of the
Cash Settlement Fund, and
• The cost of settlement administration and notice, money
awarded to the class representatives, and attorneys' fees and
expenses all as approved by the Court.
In addition, merchants in the Cash Settlement Class that accept
Visa and MasterCard during the eight-month Interchange
Period and file a valid claim will get money from the separate
Interchange Fund, estimated to be approximately $1.2 billion.
The value of each claim, where possible, will be based on
an estimate of one-tenth of 1% of the merchant's Visa and
MasterCard credit card dollar sales volume during that period.
Payments to merchants who file valid claims for a portion of
the Interchange Fund will be based on:
• The money available to pay all claims,
• The total dollar value of all valid claims filed, and
• The cost of settlement administration and notice, and any
attorneys' fees and expenses that may be approved by the
Attorneys' fees and expenses and money awarded to the class
representatives: For work done through final approval of the
settlement by the district court, Class Counsel will ask the
Court for attorneys' fees in an amount that is a reasonable
proportion of the Cash Settlement Fund, not to exceed 11.5%
of the Cash Settlement Fund of $6.05 billion and 11.5% of the
Interchange Fund estimated to be $1.2 billion to compensate all
of the lawyers and their law firms that have worked on the class
case. For additional work to administer the settlement, distribute
both funds, and through any appeals, Class Counsel may seek
reimbursement at their normal hourly rates, not to exceed an
additional 1% of the Cash Settlement Fund of $6.05 billion and
an additional 1% of the Interchange Fund estimated to be $1.2
billion. Class Counsel will also request reimbursement of their
expenses (not including the administrative costs of settlement or
notice), not to exceed $40 million and up to $200,000 per Class
Plaintiff in service awards for their efforts on behalf of the classes.
February 7 • 2013