Dive Brief:

• Visa and Mastercard have agreed to pay $199.5 million to settle a case in which a pack of merchants, including Florida retailers, alleged the card companies illegally burdened the plaintiffs with liability for rejected credit card transactions.
• Parties to the case notified the U.S. District Court for the Eastern District of New York of their settlement last week after nine years of litigation that also previously included plaintiffs American Express and Discover Financial, as well as U.S. bank card issuers.
• “Visa and Mastercard have denied and continue to deny all of Plaintiffs' claims in the action, but have agreed to enter into the V/MC Settlement to avoid the further risk, expense, inconvenience, and distraction of burdensome and protracted litigation,” the Oct. 10 settlement document said.

Dive Insight:

A group of retailers, including the Florida retailers B & R Supermarket and Grove Liquors, sued the four card companies in March 2016, alleging they had “conspired to shift billions of dollars in liability for fraudulent, faulty and otherwise rejected consumer credit card transactions” to the merchants, without providing any recourse, according to the initial complaint.

The plaintiffs argued the card companies had breached antitrust laws with their actions. They sought and received class action for the case.

The preliminary settlement with Visa, the largest U.S. card network, and the no. 2 network, Mastercard, is in addition to an agreement the plaintiffs reached earlier with American Express and Discover, which led those two smaller card companies to pay the plaintiffs $32.2 million. Overall, the case has resulted in $231.7 million in compensation for the retail litigants, including the latest settlement amount.

“The V/MC Settlement was reached deep into this litigation, with the Parties having completed fact and expert discovery and summary judgment—they were fully informed regarding the facts and the law,” the settlement proposal reads. “Moreover, the V/MC Settlement was reached only after five mediations, with two well-respected former judicial officers serving as mediators.”

Chief Judge Margo Brodie has presided over the case, but it has now been turned over to District Judge Brian Cogan for further proceedings, according to a filing in the court Tuesday.

The settlement, which was reported earlier by the news outlet Reuters, still requires approval by the court.