Litigation funder to challenge 'premature' Mastercard case settlement

A settlement agreement in the pioneering mass consumer claim against payments company Mastercard is already facing a challenge from a funder in the case, the Gazette has learned. The claim, by former financial ombudsman Walter Merricks CBE as class representative of 46 million people, had sought £17bn in compensation for excessive transactional fees. It was given the green light by the Supreme Court in 2020. 

However, it emerged last night that a settlement had been reached. Merricks' legal representative, Willkie Farr & Gallagher partner Boris Bronfentrinker, said it would be worth £40 to £50 for every UK consumer cominng forward. 

In a statement this morning Merricks said: 'I am very pleased that after nearly nine years of litigation with Mastercard, I have agreed a settlement that I believe will deliver meaningful compensation to class members who chose to come forward to participate in the distribution of the damages. Ever since I began my claim I have aimed to ensure that the new regime for collective redress can be seen to work effectively and to do that I had to take my case to the Supreme Court. I now look forward to presenting the details of the settlement to the [Competition Appeal] Tribunal for its consideration and approval.'

A spokesperson for Mastercard said: 'We are pleased to have reached an agreement in principle to put this case behind us. As the tribunal reviews the settlement, we will focus our energy on continuing to provide consumers and businesses with what they expect from Mastercard – a great payments experience, strong value and peace of mind.'

The agreement, for a figure so far undisclosed but reported to be £200m, is conditional on approval by the CAT. A hearing is expected early next year. 

High-value funder Innsworth immediately criticised the settlement. A spokesperson said: 'We strongly oppose this reported settlement which was struck without our agreement. It is both too low and premature.

'Both Walter Merricks and Boris Bronfentrinker have repeatedly claimed this is a multi billion pound case, yet they seemed to have rushed to settle for a reported £200 million raising some serious questions. We will be challenging this agreement and have already written to the CAT. We will have more to say in the coming days.'

Bronfentrinker responded: 'We are confident that the tribunal will approve the settlement. Innsworth’s opposition, and its desire that Mr Merricks continue with risky litigation that could result in UK consumers recovering significantly less, or even nothing - simply because Innsworth is unhappy that the settlement that has now been agreed may not allow it to recover the hundreds of millions it considers it should receive - has nothing to do with advancing the interests of UK consumers, and is all about funder greed.'