US Supreme Court rejects effort to revive $5.7bn interchange settlement

US Supreme Court rejects effort to revive $5.7bn interchange settlement

The US Supreme Court has refused to revive a $5.7 billion class action settlement between millions of retailers and Visa and MasterCard over interchange fees.

The court turned away an appeal from retailers that had agreed to the settlement, leaving in place a US federal appeals court decision from last year which killed off the deal.

The initial settlement was reached in 2012, with Visa and Mastercard agreeing to pay up $7.25 billion to retailers over claims that the card schemes had improperly fixed credit and debit card swipe fees.

However, the deal was soon rejected by a host of top retailers and trade groups, who counter-sued the card schemes in search of heftier fines and deeper reforms. Nearly 8000 merchants opted out, bringing the settlement down to $5.7 billion.

In a victory for those merchants, in 2016 the 2nd US Circuit Court of Appeals in New York unanimously struck down the settlement, with Judge Pierre Leval saying: "This is not a settlement; it is a confiscation."

The court ruled that a provision in the settlement stopping merchants from suing over fees was unfair and also criticised lawyers that represented the retailers for not doing enough to protect their interests.

A group of smaller retailers tried to get the settlement revived in a move supported by Visa and Mastercard but America's top court has now rejected this without commenting on its decision.

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