1. What is this settlement about?
In July 2005, several retailers and trade organizations filed a class-action lawsuit against Visa and MasterCard for conspiring with banks, including Bank of America Corp. and J.P. Morgan Chase & Co., to set interchange (or swipe) fees.
In July 2012, a settlement was reached (so both parties could avoid going to trial), creating a fund to pay $6.05 billion to merchants and temporarily reduce swipe fees by an amount equal to $1.2 billion.
A New York District Court will rule to approve the settlement. Judge John Gleeson, who is presiding over the case, held a Fairness Hearing on September 12, 2013. He said he would take the parties’ arguments under consideration but didn’t say when he expected to issue a ruling.
2. What is an interchange fee?
When a cardholder makes a purchase with a credit or debit card, there is an interchange fee attributable to those transactions, which is usually 1% to 2% of the purchase price. Interchange fees typically account for the greatest part of the fees paid by merchants for accepting Visa and MasterCard cards. Visa and MasterCard set interchange fee rates for different kinds of transactions and publish them on their websites, usually twice a year.
3. Am I entitled to receive money?
If you accepted Visa or MasterCard credit or debit cards in the U.S. at any time between January 1, 2004 and November 28, 2012, you may be eligible to receive a payment from the $7.25 billion fund established by the settlement.
4. How do I get the money?
Total Merchant Services will help you get the money and navigate the process on your behalf. Total has engaged a settlement company to oversee the process. You must Opt in to receive your payment. We are currently working on launching a website, which will be live soon, and will have details and more information on how to proceed and opt in.
5. Will I be notified when this website is live?
Yes, we will send an eblast, as well as post notices on our home page(?), and official social media pages (Facebook, LinkedIn, Twitter, Google+)
6. How much do you think I will get?
It is a multifaceted formula that involves several factors, but it is anticipated that the amount paid from the Cash Settlement Fund will be based on your actual or estimated interchange fees attributable to Visa and MasterCard transactions from January 1, 2004 through November 28, 2012. And then the amount paid from the Interchange Fund will be based on one-tenth (0.10) of 1% of your (the merchant’s) Visa and MasterCard credit card transaction volume during the eight-month period beginning July 29, 2013.
7. When will I get the money?
We anticipate that the filing period for the national Visa/MasterCard Interchange Fee Class Action Settlement will open in late fall 2013/early 2014. Distribution will be made to authorized claimants on a pro rata basis, after the settlement has been finally approved (i.e. after all appeals are concluded) and after a substantial number of all claims have been processed and approved by the Court.
8. Will Total really take care of everything?
Yes! We pride ourselves on customer service. This is our key differentiator from other merchant services companies, and we want to earn your business every day. This settlement support is one of many ways we want to serve you. Total will ensure that all of your transaction history for each month is reviewed and part of the payment. Total has records that date back to 2004, and will seamlessly provide all of the information that you need to make sure that you receive the money that you are entitled. If you do not use Total Services, it will take time to file and find your records. Total will do all of the paperwork necessary to ensure delivery of you settlement in a timely manner.
However, you MUST opt-in to receive your settlement and for Total to negotiate on your behalf. You will receive communications in regards to the opting in process.
9. Do I have to go to a hearing to get my money, or hire a lawyer?
No. You do not need to attend a hearing, nor do you need a lawyer. Our settlement company will handle the legalities of the claim on your behalf. Again, you must opt in. Be on the lookout for communications from Total in regards to how to opt in to receive your settlement.
10. How much will it cost?
Total Merchant Services has a low administration fee of $XX. There will be a recovery fee of 20%.
We do not have an accurate estimate of costs involved if you choose to process your claim by yourself. The amount of time that it would take you to personally secure records dating back to 2004, or the possible costs involved in hiring an attorney to make that request on your behalf have the potential to be far more costly than what we are offering.
11. If I don’t use Total, how hard will it be?
There is an official website to help guide you through the process and inform you regarding the steps you would need to take (www.paymentcardsettlement.com).
We have already engaged a payments services company (the keeper of all transaction payment histories) to provide the necessary documentation for all of our merchants who opt in to the settlement. At this point, we truly do not know how difficult it will be for you to obtain this documentation on your own; we can only estimate that it will be very laborious and time consuming.
12. I was not processing with you for the majority of the time. Will I still be able to use you to get my money?
Yes! We have engaged a global payments services company that can compile all your merchant info for the claim.
13. I have not been a Total Merchant Services company for some time now. Will I still be able to use you to process my claim?
Yes! You must opt –in (more details coming) and then also pay the administration fee and then Total will administer the claim process.
14. What if the amount of money you are charging surpasses the money I receive?
There are laws that protect merchants in a settlement case such as this. The fees charged to manage your claim cannot exceed the funds received.
15. Can I file on my own without a lawyer?
Yes, it is just important to take into consideration that this may be a tedious and time consuming process with strict deadlines. If you aren’t able to compile all of the necessary data in time, you will not be eligible for compensation from this settlement. Once you opt in through Total Merchant Services, we are prepared to handle the entire process on your behalf.
16. If I want to do this myself, where do I start?
You can find more information at www.paymentcardsettlement.com
Preregistration is optional and does not affect your rights under the settlement, but merchants with multiple locations and/or franchise locations as well as single location merchants are encouraged to Preregister. The information you provide will be used to assist the Class Administrator in the preparation of your Claim Form.
17. What happens if I do nothing?
If you do not opt in, you cannot get money from this settlement.