Retailers May Get Chance to Opt Back In to Swipe Fee Settlement
NEW YORK – Retailers that opted out of the $5.7 billion class-action swipe fee settlement with Visa Inc. and MasterCard Inc. may be able to opt back in under the terms of a plan being discussed by the card companies and a group of merchants, according to a Law360 report.
Both the companies and the class plaintiffs stated in a June 20 status report that they agree the court should sign off on a procedure and opt-in period for merchants to rejoin the settlement.
The original lawsuit alleged that Visa and MasterCard illegally fixed credit card interchange fees, also known as swipe fees. The settlement was proposed in July 2012, but 10 of the 19 plaintiffs, including all of the trade associations, rejected it.
Although discussions regarding an opt-in period are in the preliminary stages, it could mean the return of a portion of the takedown payment that the class plaintiffs returned to the defendants based on the number of parties that opted out in the case, according to the report.
"Defendants have not objected to a request for return of portions of the takedown payment to the extent that volume attributable to merchants that opt back in to the class would make the sum of the class exclusion takedown payments ... less than the amounts previously paid," the status report said.
The potential opt-in opportunity was prompted by concerns expressed by U.S. District Judge John Gleeson, who approved the settlement.
"Judge Gleeson had expressed the view a long time ago ... that because there was so much misinformation put out on settlement, he was inclined to give merchants the opportunity to opt back in if they wanted to," stated plaintiffs' attorney Craig Wildfang.
Wildfang added that while he knew of a small group of plaintiffs likely to opt back in, he did not expect a significant change to the size of the takedown payment.
The status report also noted some disagreement over how to determine whether franchisees or franchisors have the right to claim a share of the settlement fund. Defendants want the court to move forward and settle on a procedure for determining which side owns the claims, due to concerns about duplicated claims made by franchisors and franchisees from various chains. The plaintiffs asked the court to wait until the appeals to the settlement have been resolved.
The plaintiffs added that many of the disputes may need to be handled on a case-by-case basis.