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April 7, 2023

Latest Updates In The Visa Mastercard Settlement

Case Background

The case was brought in the United States District Court, Eastern District of New York. The settlement initially covered the period January 1, 2004, to November 28, 2012. The original net payout fund was $5.7 billion. Thereafter, the court was required to entertain a number of objections – the process for the hearing of which took until 2019. At that point, the District Court added another $1 billion to the payout fund and another seven years to the settlement period to compensate for the time lost to potential claimants during the objection hearing period and ordered that the claims be paid.

That sparked a round of appeals to the Appellate Court by various potential claimants the hearings for which were initially delayed in 2020 and 2021 by the pandemic, but which subsequently culminated in a “Final Hearing” on March 16, 2022.

On Friday, March 17, 2023, the Appeals Court issued a ruling in response to the appeals made in March of 2022.

More information about this Visa Mastercard settlement:

The Ruling

The Court of Appeals for the Second Circuit affirmed all aspects of the District Court’s final approval order from 2019. In effect, they found that the objections raised in the March 16, 2022, Final Hearing had no merit. They returned the case to the Eastern District of New York for them to implement their original order to pay out the settlement.

There was, however, one additional decree. The Appellate Court also directed the district court to reduce the size of the refunds owed to those objectors who spent time in lobbying efforts that did not increase the recovery of damages. In plain language, any past objector whose objection had no merit but only resulted in the size of their payout being increased due to delay (the fund is in an interest-bearing account) would be penalized such that the delay they caused would not result in them getting a bigger refund.

What happens next?

Legally the Court of Appeals decision can be appealed. This could lead to either of two outcomes:

1.     There is a 90-day period in which any such appeal must be submitted. If no appeals are submitted in the next 90 days, the appeals process is over, and the Eastern District can – and likely will order a claim period to be established followed by the issuing of refunds. However, the timing of that order cannot currently be known.

2.     On the other hand, the reality is that the cost and effort of appealing the ruling is so minimal for any objector that there may be little to dissuade them from taking one more shot at it. In such an instance, even one appeal would result in a further delay while the appeal is heard.

However, this possibility is offset by historical precedent. In the past, these types of appeals have had a very low probability of success. And, since the Appeals Court chose to penalize past appeals that had no merit, a potential objector to this recent ruling may decide to cut their losses and not risk a further penalty by appealing again.

In Summary

We are moving in the right direction.

We have a realistic hope and expectation that there will be a payout.

We are now left to see what happens over the 90-day waiting period.

To learn more about filing a claim in the Visa Mastercard Settlement or another class-action case, contact us today.

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