Lawyers for plaintiffs in a Visa Inc. and MasterCard Inc. antitrust case over interchange fees asked for final approval of a settlement along with $720 million in legal fees and $27 million in expenses.
The attorneys, representing a class of more than 7 million merchants, filed papers late yesterday in Brooklyn, New York, seeking a final blessing for the accord from U.S. District Judge John Gleeson.
The settlement, estimated to be the largest ever in an antitrust case, would provide for about $7.25 billion in cash payouts, according to a memorandum filed by Robbins Geller Rudman & Dowd LLP, one of the lead law firms in the case.
"With the largest-ever cash relief in an antitrust class action settlement plus unprecedented rules changes that would enable merchants to recover their costs of credit card acceptance" the settlement "is far more than 'fair, adequate, and reasonable,'" the lawyers wrote.
In a separate filing, the lawyer said their request for attorneys' fees is reasonable given the complexity of the issues and the length of time of the eight-year-long case.
"The settlement will affect as great a segment of the United States economy as any previous antitrust class action," lawyers for the plaintiffs said in the filing, noting that about 60 law firms worked on the case. "Such an extraordinary settlement could result only from a similarly extraordinary effort by class counsel and their co-counsel."
Merchant trade groups and some large retailers including Target Corp., Wal-Mart Stores Inc., Home Depot Inc. spoke out against the accord, claiming it isn't large enough and gives card companies too much leeway to raise fees in the future. The lawsuit alleged the card companies and some of the country's largest banks conspired to fix prices of fees paid by merchants when customers pay with plastic.
A hearing on final approval has been scheduled for September.
The case is In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, 05-md-01720, U.S. District Court, Eastern District of New York (Brooklyn).