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Credit Card Merchant Fee Class Action: The Release From Liability

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4 Responses

  1. That limit — claims that “were or could have been alleged” — strikes me as a hard one, both as a matter of Rule 23 and as a matter of Article III. Class-action settlements are not and cannot be a vehicle for releasing unrelated future claims: it violates the Due Process rights of the absent class members. This is an opt-out mass-market contract of adhesion wearing the mask of a class action.

  2. Brad says:

    Is the release identical for the opt-out and non-opt out classes?

    How can only injunctive relief possibly be fair, reasonable, and adequate if the other plaintiffs being represented by class attorneys (i.e. the b(3) class) — including all the class representatives are getting that relief plus $7 billion for releasing the same exact claims?

  3. Steve Semeraro says:

    I certainly agree with the concerns about the release. Most shocking to me is that no one seems to be focused on it. I’ve seen discussion about whether the damages and injunctive relief should be deemed adequate, but very little on the scope of the release. Sykes report does highlight the sharp distinctions in how the parties view it. The plaintiffs’ counsel believe that it will not bar them from bringing unrelated future claims essentially based on — not the language of the release — but on the idea that it would violate due process. The defendants, though, believe that the release means what it says. It seems like an odd argument for approval of a settlement to say, “well, we don’t have to worry about that extreme language because a court will hold that it violates the constitution.”

  4. Steve Semeraro says:

    I think the argument with respect to future merchants is that if they were NOT accepting credit cards during the pre-settlement period, then they weren’t paying the supra-competitive fees that may have resulted in a market without the customer steering devices that the settlement provides. Future merchants would thus not be entitled to damages.