Key points:
- Visa and Mastercard finalize a $197.5 million settlement over inflated ATM fees.
- Attorneys' fees awarded at $49.4 million, less than the original $60 million request.
- The settlement ends litigation dating back to 2011 and caps an antitrust case involving fee-fixing accusations.
Visa Inc. and MasterCard Inc. have officially received approval for a $197.5 million settlement in an antitrust lawsuit related to inflated ATM fees. The approval, granted by Judge Richard J. Leon of the US District Court for the District of Columbia on Monday, concludes litigation that had been ongoing since 2011. Consumers had accused the card companies of colluding to artificially inflate fees for withdrawing cash from ATMs.
The settlement amount is $197.5 million, slightly less than the original $198 million proposed. However, a significant reduction came in the form of attorney fees. The plaintiffs' legal team initially sought nearly $60 million—representing 30% of the total settlement—but Judge Leon awarded $49.4 million, a figure that still reflects a substantial portion of the settlement. More details on the legal proceedings can be found in this Bloomberg Law article.
The case arose from accusations that Visa and Mastercard entered into an illegal agreement to increase ATM withdrawal fees, thereby raising costs for consumers while reducing competition among ATM operators. The decision to settle followed a ruling by the Supreme Court, which declined to review the class certification in the case, leaving the card companies with limited legal options.
This settlement is part of a broader pattern of litigation targeting Visa and Mastercard, which have faced numerous antitrust challenges, including actions by merchants who have contested the companies' swipe fee policies. The settlement does not resolve all ongoing cases involving the card companies, but it marks a significant resolution to one of the more high-profile cases concerning consumer fees.
Visa and Mastercard, which control vast ATM networks globally, were represented by top-tier law firms: Arnold & Porter Kaye Scholer LLP for Visa and Paul, Weiss, Rifkind, Wharton & Garrison LLP for Mastercard. The plaintiffs, led by firms such as Hagens Berman Sobol Shapiro LLP, Quinn Emanuel Urquhart & Sullivan LLP, and Mehri & Skalet PLLC, expressed satisfaction with the outcome, though the case's long duration reflects the complex legal landscape surrounding antitrust claims in the financial services industry.
