Court Rejects Visa, MasterCard Settlement With Retailers

(RTTNews) - A federal appeals court panel threw out a $7.25 billion antitrust settlement between Visa Inc. (V) and MasterCard Inc. (MA) and millions of retailers after determining that some of the merchants covered by the pact weren't adequately represented.

The ruling is a blow to the world's biggest payments networks, which sought an end to bitter court battles over fees that exceed $40 billion annually. The lawsuit, brought on behalf of 12 million merchants nationwide, was filed a decade ago after earlier disputes over the fees. The rejection of the deal raises the prospect that it will have to be renegotiated or the case may go to trial.

The settlement thrown out had been struck in 2012 and approved by a court in 2013. Visa and MasterCard originally agreed to pay merchants $7.25 billion, although the total was later reduced to about $5.7 billion as many dropped out. The pact also allowed retailers to charge customers more for using credit cards than other forms of payment.