PURCHASE, N.Y.—Mastercard reported it has reached an agreement to settle monetary damages claims in a U.S. merchant class-action litigation suit.
“The agreement formalizes prior discussions and has been executed by all of the defendants – including Mastercard, Visa and a number of banks – and the court-appointed class counsel for the merchants,” Mastercard said.
The settlement is an amendment to the financial terms of the 2012 Class Settlement Agreement and will be filed with the court seeking approval, the company said.
“We are taking a significant step toward closing a chapter in a long-standing case,” said Tim Murphy, general counsel, Mastercard. “We can put this behind us and focus on continuing to innovate with our merchant partners to deliver the experience and convenience that consumers expect.”
In addition to the original 2012 monetary terms, Mastercard’s share of the financial agreement is an additional $108 million, which is based upon the allocation of financial responsibility that was set out in the judgment and settlement sharing agreements that were executed in February 2011. In total, the defendants have agreed upon an additional payment of $900 million in the current agreement, Mastercard said.
The company recorded a $210 million charge in its second-quarter 2018 financial statements, which will cover the financial obligation under this agreement and for estimated liabilities related to filed and anticipated opt-out merchant cases, Mastercard said.
The merchant class-action that seeks the revision of network rules is not covered by this settlement agreement. That action remains outstanding while the parties are engaged in settlement negotiations, Mastercard said.