Visa, MasterCard Reach Swipe Fee Settlement with Delta

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According to documents filed Wednesday in New York federal court, Delta Air Lines Inc. has reached a settlement that will resolve all allegations against Visa and MasterCard in a lawsuit it filed over the credit card companies’ swipe fees. Delta filed the swipe fee lawsuit after it opted out of last year’s massive settlement of the multidistrict litigation (MDL) known as In re: Payment Card Interchange Fee and Merchant Discount Antitrust Litigation.

Although details about the swipe fee settlement have not been released, Delta has asked U.S. District Judge John Gleeson to dismiss the claims against Visa and MasterCard with prejudice. The settlement also resolves claims brought on behalf of Northwest Airlines Corp., which joined Delta in a 2009 merger, as well as Delta Private Jets Inc. and MLT Inc.

The Visa/MasterCard swipe fee class action lawsuit was initially filed in 2005. While it originally focused on the alleged collusion between the credit card companies and the banks that founded them, by the time the swipe fee settlement was reached, the litigation focused on the companies’ restrictions on the merchants who accepted their payment cards and the interchange fees they imposed.

Although the parties agreed to the swipe fee class action settlement more than a year ago, it has been the subject of numerous objections. Many companies, including Delta, have opted out of the swipe fee settlement. In August 2013, Delta and more than 100 other companies who accept Visa and MasterCard payment cards filed a separate class action lawsuit against the credit card companies, alleging they were made to pay substantial swipe fees because the companies conspired with banks to manipulate the fees retailers were charged any time they accepted Visa or MasterCard debit or credit cards.

In December 2013, a federal judge approved what is believed to be the largest antitrust settlement in history over the alleged Visa/MasterCard swipe fee conspiracy. Under the terms of the historic $7 billion class action settlement, nearly 12 million merchants who accept the payment cards would be entitled to claim money from the settlement fund.

Following the approval of the Visa/MasterCard settlement, hundreds of merchants, banks and health care providers appealed the case to the 2nd U.S. Circuit Court of Appeals, asking the appellate court to overturn the settlement because it grants Visa and MasterCard “sweeping prospective immunity” from future litigation.

According to the Settlement Administrator’s website, Claim Forms for the Visa/MasterCard swipe fee settlement will not be available until all appeals are resolved. Further information about the class action settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also mark this article as a “Favorite” using your free Top Class Actions account to receive notifications when this article is updated.

Delta’s Swipe Fee Lawsuit is Delta Air Lines Inc., et al. v. Visa Inc., et al., Case No. 13-cv-04766, in the U.S. District Court for the Eastern District of New York.

The Visa/MasterCard Swipe Fee Class Action Lawsuit is In re: Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, Case No. 1:14-md-01720, in the U.S. District Court for the Eastern District of New York.

UPDATE: On Dec. 1, 2016, merchants seeking to wrap up a credit card swipe fee class action settlement are appealing their case to the U.S. Supreme Court.

UPDATE 2: On Sept. 18, 2018, Visa, MasterCard, and numerous banks including Bank of America, Barclays, JPMorgan Chase, Citibank, and SunTrust Bank, have reached a new $6.2 billion settlement deal to resolve a massive antitrust swipe fee multidistrict litigation.