PHILADELPHIA, July 13, 2012 /PRNewswire-USNewswire/ -- Berger & Montague, P.C., as one of three Court appointed Co-Lead Class Counsel, announces that a historic $7.25 billion settlement has been reached on behalf of a class of approximately seven million merchants in the United States who accept Visa and MasterCard credit cards and debit cards. The settlement is with payment card networks Visa and MasterCard and with card-issuing banks, including JPMorgan Chase, Bank of America, Citibank, Wells Fargo, Capital One and other major banks.
Berger & Montague, P.C. was appointed by the United States District Court for the Eastern District of New York, along with two other law firms, to represent the class in the case. The settlement is believed to be the largest ever settlement of a private antitrust case under the Sherman Act (15 U.S.C.section 1 et seq.).
The settlement terms include a cash payment and significant modifications to Visa's and MasterCard's rules. The cash component of approximately $7.25 billion consists of a payment for alleged past damages in the amount of $6.05 billion, and a further payment estimated at $1.2 billion representing the value to merchants of a temporary reduction in the level of interchange fees paid by merchants on Visa and MasterCard credit card transactions. The modifications to the rules of Visa and MasterCard will encourage transparency of payment card costs at the point of sale and allow merchants to steer customers to less expensive methods of payment, thus allowing consumers to make choices that affect the cost of goods and services. These rules modifications required by the settlement should allow merchants to put pressure on Visa and MasterCard to lower interchange fees. This should help merchants to reduce one of their more significant costs of doing business which over time should result in lower prices to consumers.
This litigation and this settlement has and will have a very meaningful impact on changing the playing field over time in the credit and debit card industry. It should all redound to the benefit of both merchants and consumers. H. Laddie Montague, Jr., Merrill G. Davidoff, Bart D. Cohen and Michael J. Kane led the case for Berger & Montague, P.C.
The case is In re Payment Card Interchange Fee and Merchant Discount Litigation, 05-MD-1720 (JG)(JO). The other Co-Lead Counsel law firms that represent the class of merchants are Robins, Kaplan, Miller & Ciresi L.L.P. and Robbins Geller Rudman & Dowd LLP.
SOURCE Berger & Montague, P.C.