Summary
MasterCard Incorporated (MA) filed an 8-K on July 25, 2006, to report a significant development regarding litigation. The company, along with other defendants, entered into a settlement agreement for the consolidated federal class action lawsuit "In re Foreign Currency Conversion Fee Antitrust Litigation (MDL 1409)" and a related California state court action, "Schwartz v. Visa Int’l Corp., et al.". These lawsuits concern charges made by cardholders for transactions in foreign currencies or with foreign merchants. As part of the settlement, MasterCard has agreed to pay $72.48 million towards a $336 million settlement fund for the federal case, covering monetary claims, administrative costs, and legal fees. Additionally, MasterCard will pay $13.44 million to settle the California state case, expected in 2007. This settlement is contingent upon approval by the United States District Court for the Southern District of New York, and upon approval, it will resolve all claims related to these currency conversion lawsuits.
Key Highlights
- 1MasterCard has agreed to a settlement in "In re Foreign Currency Conversion Fee Antitrust Litigation (MDL 1409)" and the related "Schwartz v. Visa Int’l Corp., et al." lawsuit.
- 2The litigation concerns antitrust claims related to foreign currency conversion fees charged to cardholders.
- 3MasterCard's contribution to the settlement fund for the federal case is $72.48 million.
- 4The total settlement fund for the federal case amounts to $336 million, contributed by multiple defendants.
- 5MasterCard has separately agreed to pay $13.44 million to settle the California state court action.
- 6The settlement payments are subject to court approval by the United States District Court for the Southern District of New York.
- 7The settlement is expected to extinguish all claims related to these specific currency conversion lawsuits upon court approval.