The credit card companies will pay between $5.56 and $6.26 billion under the deal. Class counsel believes it is the largest cash settlement in antitrust class action history.
The new settlement resolves the conflict of interest issues the U.S. Court of Appeals for the Second Circuit found with the initial deal, Judge Margo K. Brodie wrote for the U.S. District Court for the Eastern District of New York.
The merchants allege the defendants and various banks violated antitrust laws by illegally inflating swipe, or interchange, fees that merchants pay on every purchase transaction and banks use to fund consumers’ credit-card rewards.
The original settlement, worth up to $7.25 billion, passed muster in the district court but was vacated by the Second Circuit. The appeals court said having the same counsel represent injunction and damages classes was a conflict of interest.
Back on remand, the district court appointed separate counsel for the classes.
That resolves the appeals court’s concerns, the lower court said.
“The structural defect of unitary representation no longer exists,” it said.
Nussbaum Law Group P.C., Hilliard & Shadowen LLP, Freed Kanner London & Millen LLC, and Grant & Eisenhofer P.A. represent the injunctive relief class. Robins Kaplan LLP, Berger & Montague P.C., and Robbins Geller Rudman & Dowd LLP represent the monetary damages class.
Paul, Weiss, Rifkind, Wharton & Garrison LLP and others represented Mastercard. Arnold & Porter Kaye Scholer LLP and others represented Visa.
The case is In re Payment Card Interchange Fee & Merch. Disc. Antitrust Litig., 2019 BL 27436, E.D.N.Y., No. 05-MD-1720, 1/28/19.