£200m Mastercard settlement approved by Competition Appeal Tribunal

The Competition Appeal Tribunal has approved the settlement between class representative Walter Merricks CBE and Mastercard – with one of the three judges describing the £200 million achieved as ‘disappointing’.

The collective action, brought by Merricks and originally seeking more than £14bn, followed the European Commission’s 2007 finding that, between 1992 and 2007, Mastercard’s ‘multilateral interchange fees’ breached Article 101 of the EU Treaty which bars direct or indirect fixing of prices or trading conditions. The claim was brought on behalf of around 44 million individuals.

The settlement, announced in December, had been challenged by litigation funder Innsworth Capital on the grounds that it was premature and too low. However Mark Brealey KC, for Merricks, told the court Innsworth ‘has not got a bad return’.

Tribunal chair Mr Justice Roth thanked 'counsel and those behind' for their assistance and said a judgment would be ready ‘with the next three weeks’. His colleague Hodge Malek KC paid tribute to Merricks. 'Being a class representative is a huge responsibility. Mr Merricks has tirelessly fought for class members over the last eight years and that is appreciated. The fact the outcome has been disappointing in the light of how the evidence and rulings have developed does not detract from that.’

In a statement after the three-day hearing, Merricks said: ‘I am very pleased that after more than eight years, where I have given my all to get the best result possible for UK consumers, that the tribunal has today confirmed that the settlement I agreed with Mastercard is just and reasonable – in fact, the tribunal went as far as to say it had no doubt about that.

‘I had clearly hoped to have recovered more, but the case and facts developed in a way which meant I could recover less than I initially planned, but I recovered the best amount possible. I now look forward to distributing the settlement to get it in the hands of UK consumers.’

Boris Bronfentrinker, partner at Willkie Farr & Gallagher, who represented Merricks, said the settlement had been the ‘culmination of more than eight years of hard work’.

He added: ‘Mr Merricks and his entire team of advisers have fought as hard as possible over that time to get the best possible outcome. There have been over 30 rulings, multiple trips to the Court of Appeal and also to the Supreme Court. Mr Merricks has had to adapt as the case and the facts evolved, but he secured the best possible outcome, which the tribunal today said it had no doubt was the case.

‘These proceedings started off as a landmark case in setting the foundation for collective actions in the UK and it will end being as equally groundbreaking in a settlement achieved under heavy attack and challenge by the litigation funder.

‘It is most unfortunate that Innsworth chose to fight the settlement and to also threaten Mr Merricks personally by starting litigation against him. Its efforts have today failed and hopefully they accept that and move on.’

A Mastercard spokesperson said: ‘We welcome the tribunal’s decision. We will continue to focus on providing consumers and businesses with what they expect from Mastercard – a great payments experience, strong value and peace of mind.’