Visa/MasterCard Interchange Fee Litigation – May 28, 2013 Deadline to Respond to Class Action Settlement Agreement

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All entities that accept Visa- or MasterCard-branded credit and/or debit cards must decide, on or before May 28, 2013, how to respond to the settlement agreement with Visa and MasterCard on behalf of a class covering merchants who accept Visa- or MasterCard-branded payment cards in the United States. The decision by any entity covered by the settlement to accept the settlement offer, to opt-out of the settlement class, and/or to object to the terms of the settlement agreement necessarily involves a complex cost-benefit analysis of the value to be received by such entity compared to the value of the rights released by such entity under the settlement agreement. As a result, any entity that accepts Visa- or MasterCard-branded credit and/or debit cards is advised to carefully review the terms of the proposed settlement so as to be in a position to make a considered decision regarding the exercise of its opt-out and objection rights regarding the settlement.

On November 27, 2012, the United States District Court for the Eastern District of New York issued an order granting preliminary approval of the Definitive Class Settlement Agreement dated October 19, 2012 (the “Class Settlement Agreement”) among class plaintiffs and defendants in the putative class actions and individual plaintiff actions consolidated as In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, No. 05-MD-1720-JG-JO (“Interchange Fee Litigation”). The Interchange Fee Litigation proceedings involved claims alleging that Visa and MasterCard, separately, and together with various financial institutions, 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 default interchange fees, limiting what merchants could do to encourage customers to use other forms of payment, and continuing such conduct after Visa and MasterCard changed their corporate structures.

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