UK Supreme Court dismisses Mastercard challenge to $ 18.5 billion class action lawsuit
MasterCard (NYSE: MA) suffered a setback in a potentially damaging case heard in Europe. The UK Supreme Court has dismissed the company’s request to impose individual lawsuits over interchange fees in the country, rather than the £ 14bn ($ 18.5bn) class action suit currently at study. The vote on the request was tight, with three of the five ruling judges voting against and two for.
The sprawling lawsuit alleges that the Mastercard intra-European merchant interchange fee charged for personal cards restricted competition in the market over a 16-year period ending in late 2007.
The European Commission – the governing body of the continent’s European Union economic bloc – made such a decision in December 2007. In the UK, it was used as the basis for a case brought by a government mediator before a lower court in 2016.
Interchange or “swipe” fees are essential in the field of payment cards. They represent a small percentage of each sale billed to the merchant selling the merchandise or service.
Mastercard initially challenged the findings of the European Commission unsuccessfully. He has since changed his legal strategy to challenge the validity of the class action lawsuit.
If the court ends up awarding the class the full amount, each of the 46.2 million class action parties will receive 303 pounds ($ 401).
Mastercard has yet to comment on the latest developments in its case. While losing it would undoubtedly be a financial setback, the company is generating mounds of cash and would likely be able to recover before long. At the end of its last quarter, it had more than $ 11.2 billion in cash and cash equivalents.
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