$7.2B settlement over card fees receives initial approval
NEW YORK A federal judge gave preliminary approval Friday to a $7.2 billion settlement between major credit card companies and retailers over alleged fee-fixing, parties involved in the case said.
Visa (V), MasterCard (MA) and other card companies agreed in July to settle a lawsuit brought by retailers that claimed card issuers conspired to fix the fees they charge stores for accepting credit cards.
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The National Retail Federation, representing more than 9,000 retailers across the country, had argued that a provision barring retailers from filing lawsuits over swipe fees was too broad.
Retailers had also argued that the $7.2 billion was far less than what retailers deserved and might have won at trial. The preliminary approval was granted Friday by Judge John Gleeson of Brooklyn federal court, both sides in the case said.
Visa called the settlement a "fair and reasonable compromise." MasterCard also said it was pleased and said a provision in the settlement allowing retailers to charge checkout fees for credit-card customers was supported by millions of retailers.
The retail federation repeated its opposition.
"It's a morass of legal flaws, and rather than bringing about reform it would only entrench the anticompetitive behavior of the card companies while putting them beyond the reach of the law," said Mallory Duncan, a federation lawyer.
The federation said it was exploring legal options. Gleeson still must grant final approval to the settlement. MasterCard said it hoped that would happen in the coming months.
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