ARLINGTON, Va. — The National Grocers Association here and other plaintiffs in a lawsuit against Visa, MasterCard and their card-issuing banks said they are not happy with a settlement that that was negotiated on their behalf by the law firms that represented them in the case.
“This settlement was crafted by class counsel without our input,” said Peter Larkin, president and chief executive officer, NGA, in a conference call on Monday. “We think it is a bad deal. It’s good for the lawyers, and bad for the plaintiffs.”
He said the proposed settlement, through which the credit card companies would pay merchants $7.25 billion, does not introduce enough structural reforms into the interchange-fee landscape. It also bars the merchants from additional litigation related to the settlement.
Doug Kantor, counsel to the National Association of Convenience Stores, which was also a plaintiff in the suit, said the settlement is opposed by a majority of the named plaintiffs. “It is very unusual to say the least for lawyers representing a class to try to cram a settlement down the throats of their own clients and former clients against the wishes of those clients and try to make an agreement that most of the class that they purport to represent does not agree with,” he said.
Read more: Retailers Oppose Proposed Interchange Settlement
Scott Defife, executive vice president, policy and government affairs, National Restaurant Association, said the attorneys for the plaintiffs “focused more on what Visa and MasterCard would agree to rather than what merchants wanted.”
In a statement, the attorneys representing the plaintiffs said they did achieve “meaningful structural reforms” in interchange fee structure, which the plaintiffs charge functions like a monopoly.
“The meaningful structural reforms that could have been obtained by merchants through further litigation were achieved,” said K. Craig Wildfang, co-lead counsel for the merchants and partner at Robins, Kaplan, Miller & Ciresi. “These important structural reforms will shift the balance of power from the two dominant payment networks toward card-accepting merchants, ultimately for the benefit of consumers.”
The settlement was submitted for preliminary approval on Friday.
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