21 August 2017
visit www.avoka.com

UK judge blocks £14bn class action suit against Mastercard

21 July 2017  |  15013 views  |  0 Mastercard logo

A Tribunal Court judge has blocked a £14 billion class action lawsuit against Mastercard for overcharging customers, agreeing that the claims were not suitable under the current collective actions regime.

The decision will be of significant relief to Mastercard given that it was set to be the largest and most complex case in UK legal history, involving 45 million people in Britain over a period of 16 years.

The case would also have tested the parameters of the relatively new Consumer Rights Act which only introduced US-style collective class actions in 2015 for breaches of UK or EU competition law.

In a statement Mastercard said: "We welcome the Competition Appeal Tribunal's judgment refusing certification for the proposed collective action."

The class action was brought by a US law firm, Quinn Emanuel Urquhart & Sullivan, back in 2007 following MasterCard's unsuccessful appeal against a European Commission ruling that its fees were anti-competitive.

More specifically, the case focused on the use of interchange fees charged by numerous credit and debt card companies - fees which the card companies say are charged to merchant banks to cover the cost of innovation, security and operational overheads.  

This latest ruling from the Competition Appeal Tribunal follows a High Court ruling back in January in a dispute with retailers that Mastercard's use of interchange fees had been lawful and not anti-competitive.

The class action case may not be over for Mastercard though. The London-based lawyer and named representative for the class action, Walter Merricks, said he was "surprised" and "disappointed" by the ruling and said he was considering an appeal. 

Mr Merricks, a former leader of the Financial Ombudsman Service said: "I am concerned that this new regime, designed to benefit consumers, may never get off the ground. The granting of the collective proceedings order in this case would have allowed 46m consumers to recover the losses caused to them by Mastercard’s proven illegal conduct.

"It is, however, unfortunate that the Tribunal considered that it was not satisfied that my experts would be able to get the evidence to show that the illegal fees charged by Mastercard to businesses were then passed on to consumers in the form of higher prices."

Of particular frustration to Mr Merrick was the Tribunal's determination over the inability to accurately calculate the loss suffered by all 46m consumers included in the suit and the result that "consumers should get nothing at all".

"I believe these are matters my advisers could have addressed and overcome had the claim been allowed to proceed. I am actively considering with my advisors and litigation funders the possibility of an appeal," he said.

KeywordsLEGAL

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

UK Government to ban "rip off" card surcharges

UK Government to ban "rip off" card surcharges

19 July 2017  |  9989 views  |  15 comments | 17 tweets | 30 linkedin
£14 billion lawsuit against MasterCard edges closer to UK courts

£14 billion lawsuit against MasterCard edges closer to UK courts

09 September 2016  |  9078 views  |  3 comments | 10 tweets | 9 linkedin
MasterCard faces £19 billion UK interchange suit

MasterCard faces £19 billion UK interchange suit

06 July 2016  |  12769 views  |  4 comments | 15 tweets | 21 linkedin
MasterCard pays out $61 million to settle Tesco interchange suit

MasterCard pays out $61 million to settle Tesco interchange suit

31 July 2015  |  9527 views  |  0 comments | 12 tweets | 7 linkedin
Discover fires lawsuit alleging anti-competitive practices at Visa

Discover fires lawsuit alleging anti-competitive practices at Visa

26 November 2014  |  6233 views  |  3 comments | 1 tweets | 3 linkedin
Wal-Mart sues Visa over card fees

Wal-Mart sues Visa over card fees

27 March 2014  |  8400 views  |  2 comments | 7 tweets | 9 linkedin

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.worldpaymentsreport.comvisit www.dorsum.euvisit www.niceactimize.com

Top topics

Most viewed Most shared
Mobile contactless spending accelerating in UKMobile contactless spending accelerating i...
10574 views comments | 24 tweets | 23 linkedin
Norwegian banks and startups form fintech clusterNorwegian banks and startups form fintech...
8830 views comments | 19 tweets | 23 linkedin
hands typing furiouslyWhy Is Risk Analytics Important?
8816 views 0 | 4 tweets | 1 linkedin
RBS to bring Silicon Valley to EdinburghRBS to bring Silicon Valley to Edinburgh
8500 views comments | 10 tweets | 7 linkedin
Barclays pairs banking data with third party apps for SmartBusiness DashboardBarclays pairs banking data with third par...
8138 views comments | 17 tweets | 16 linkedin

Featured job

Competitive base and bonus, plus benefits
London, UK

Find your next job