Merchants Get Another Extension to File Claims in Their Class Action Against Visa and Mastercard

Merchants were granted a second extension late Tuesday for filing claims against Visa Inc. and Mastercard Inc. in their ongoing class-action lawsuit against the two networks over interchange costs.

U.S. District Court Judge for the Eastern District of New York Margo K. Brodie, who is presiding over the case, moved the deadline for filing a claim to Feb. 4, 2025, a 180-day extension. Earlier this year, the court extended the claim-filing deadline from May 31 to Aug. 30.

In June, Judge Brodie nullified a proposed settlement between the card networks and merchants, a move that is expected to send the years-old case to trial.

The latest deadline extension comes at the behest of class administrator Epiq Class Action & Claims Solutions Inc. In a declaration filed with the court and dated Aug. 6, Loree Kovach, senior vice president for Epiq, argued that since notice of filing a claim was provided to class members in 2019, “the Class Administrator has received additional data from Visa and others” that reveals a significant number of additional class members did not receive claim forms sent in 2023.

 As a result, Kovach argued that such activities as mailing additional claim forms to known likely members of the settlement class, along with an extended deadline to submit claims in light of those anticipated mailings and a minimum payment alternative approach to more efficiently process low-dollar claims, are in the best interest of the class. She recommended a 180-day extension of the filing deadline.

Kovach went on to say that the Class Administrator expects to be able to finalize all data-preparation work and start mailing forms “within approximately 50 days of entry of an order from this court.”

Co-counsels for the merchants supported the extension request in a separate letter to Judge Brodie. “Class Counsel and Epiq want to ensure that as many class members as possible are able to obtain settlement benefits, and mailing claim forms to additional potential claimants which can be recovered from these additional data sets will advance that goal. If granted, this additional time for the claims process will benefit all class members,” co-counsels said in the letter.

Merchants are being represented by Robins Kaplan LLP, Berger Montague PC, and Robbins Geller Rudman & Dowd LLP.

The Merchants Payments Coalition, which lobbies on behalf of sellers on interchange and related matters, welcomed news of the extension. “There are so many claimants, it’s understandable that [the claims administrator] is still finding potential claimants,” says Doug Kantor, an MPC executive committee member and general counsel for the National Association of Convenience Stores.

Still, the extension is likely to raise the cost of settlement for Visa and Mastercard, Eric Grover, proprietor of payments consultancy Intrepid Ventures, argues by email.

“This will cost Visa and Mastercard more because more merchants, presumably, will file claims,” Grover says. “The unsettled consolidated antitrust suit challenging Mastercard’s and Visa’s business practices is far more worrisome for the payment networks, for their shareholders, for cardholders, and indeed for the entire payments ecosystem.”

The extended filing deadline is not a surprise, he adds, because “neither plaintiffs’ attorneys nor the court want a settlement where only an embarrassingly small percentage of the putatively aggrieved can bother to file a claim.”

In a related matter, merchants’ co-counsels pointed out in their letter to Brodie that they have “reached an impasse” with Square Inc. over using data provided in 2019 to check if a claim form had already been sent directly to a member of the class.

If a form had not been mailed, co-counsels requested that claim forms be sent to certain submerchants that may be unique in Square’s data. “Without this data, some set of merchants who only used Square as a payment facilitator during the relevant time, may not be mailed claim forms, despite the data being extant,” co-counsels said in their letter.