Individuals in Britain who use MasterCard, an American multinational financial services corporation, could potentially benefit from a recent legal case that has been brought against the company almost two years after a European Union court ruled the processing fees that company had charged for cross-border transactions were unfair. According to court documents filed in London, 46 million people have been allegedly charged for excessive fees. This legal case is demanding $14 billion pounds, which is the equivalent of $19 billion dollars, be returned from the MasterCard company.
The case further claims that the company charged unlawfully high fees to stores when shoppers swiped their debit or credit cards, which were then passed on to consumers in higher prices. MasterCard is alleged to have done this for 16 years between 1992 and 2008, in more than 600 pages of documents filed at the Competition Appeal Tribunal on Thursday, Sept. 8.
According to Reuters, any person living in Britain who used a credit card, cash or checks and was over 16 years old in the period covered by the lawsuit will automatically be part of the claim. If the 14 billion pound claim was shared equally between the numbers of eligible claimants, each person could receive more than 300 pounds. Britain’s banks have been caught in a range of mis-selling cases in the last five years.
They have paid 24 billion pounds in compensation for mis-selling loan payment insurance, making it Britain’s most expensive scandal in financial services. Consumers no longer living in Britain, but who lived in the country between 1992 and 2008, can opt in to the collective claim against MasterCard.
Walter Merricks, a lawyer who once led the U.K. organization that handles consumer disputes with banks, now serves as the head lawyer for this claim against MasterCard. Merricks has hired Quinn Emanuel Urquhart & Sullivan LLP to draft the lawsuit against the MasterCard company. This claim serves as the U.K.’s biggest as well as one of the first claims filed under the Consumer Rights Act 2015. Boris Bronfentrinker, lead partner at Quinn Emanuel, said, “this is precisely the type of claim for which the new collective action regime was established. This is a landmark case where unlawful anti-competitive conduct has harmed U.K. consumers.”
Merricks told the BBC, “this was almost an invisible tax. MasterCard has behaved disgracefully in this. They have not had the reasonableness to accept that what this was doing was damaging U.K. consumers.” According to Bloomberg, Merricks has announced, “my aim is to get the redress to which U.K. consumers are entitled and to ensure that MasterCard cannot hold on to the illegal profits.”
The MasterCard company has fought back and denied that it violated competition law by charging buyers excessive processing fees. MasterCard has also argued that stores cannot claim damages since they passed losses on to customers. Due to this continuing feud, suits are ongoing. Any hearing on the case is not expected to take place until early 2018, unless MasterCard decides to settle it out of court.
Editor’s Note: Information from Time Magazine, Fortune Magazine, USA Today and Slate Magazine was used in this report.