Another Step Closer to Final Approval of the Interchange Settlement

Another Step Closer to Final Approval of the Interchange Settlement

Definitive Settlement Agreement and Motion for Preliminary Approval Filed

On October 19, 2012, class counsel, on behalf of numerous retailers who are proposed class representatives, filed the Definitive Settlement Agreement, as well as a motion to request that the Honorable Judge Gleeson of the U.S. District Court for the Eastern District of New York preliminarily approve a landmark settlement of a lawsuit over merchant interchange fees.  The settlement was originally announced on July 13th after over seven years of litigation, mediation and negotiation between retailers, payment networks and nine major card issuers.  The parties involved have now come together to take the next step in the process in an effort to settle this dispute once and for all.

“This settlement is the culmination of seven years of litigation, two full years of mediation,  the consent of all parties, and the direct oversight of Judge Gleeson,” said Robert Stolebarger, a Partner at Bryan Cave LLP and antitrust counsel for the Electronic Payments Coalition.  “As with any settlement, both sides had to give a little or a lot here and there to reach a compromise – and as a result, no one is entirely happy.  But in the end, in my view, this settlement represents the very best and most realistic outcome possible for all involved.”

In a brief filed with the Court by the proposed retailer class representatives, it was explained why the settlement should receive preliminary approval from the Court.  Some of the key points that the retailers made to support the settlement include:

–Class Counsel’s Memorandum in Support of
Plaintiffs’ Motion for Class Settlement Preliminary Approval, p. 9

–Class Counsel’s Memo, p. 15.

–Class Counsel’s Memo, p. 1 and p. 16

Members of the Electronic Payments Coalition remain highly confident that the Court will grant preliminary approval in or around January 2013, and ultimately final approval later that year.

“This represents the end of a long battle over fees between the retail and payment card industries,” says Trish Wexler, spokeswoman for the Electronic Payments Coalition.  “Sadly, for some retail lobbying groups, it is clear that nothing will ever be enough.  But let’s call this what it really is – politically motivated greed.  These groups are simply hoping to create enough noise to attract Congress’s attention and extract even more money from the Hill – money that they will never return to consumers.  We remain confident that this truly is the end of the “swipe fee” debate, and that preliminary approval and eventually final approval will be granted by the Court.”

Recent noise in the press by some retailers who are “objecting” to the settlement has raised a number of questions as to the outcome of this settlement.  Today, the Electronic Payments Coalition released an interview with Mr. Stolebarger where he addresses some of the most commonly asked questions.