16:11, November 14 343 0

2016-11-14 16:11:20
Tesco settles with Visa over ‘unlawful’ credit card fees

Tesco has settled its mammoth court battle with Visa over allegations it charged anti-competitive credit card fees, The Lawyer has learned.

Tesco was due to face Visa in court this morning (14 November) alongside retailers including Asda, Morrisons and Sainsbury’s, however the judge revealed to the courtroom that Tesco and Visa had settled their dispute late last week.

The case, which will seek combined damages in excess of £1.2bn, proceeded without Tesco and will run in the commercial court for several weeks.

The settlement figure is not yet known. Tesco also settled with MasterCard for £39m last year in a similar case over anti-competitive interchange fees.

Tesco was the largest claimant in the MasterCard litigation and the settlement was revealed by the credit card company’s CFO during its annual results statement.

Humphries Kerstetter, run by former Linklaters partners Mark Humphries and Kristopher Kerstetter, acted for Tesco in the Visa case.

Meanwhile Visa was represented by Linklaters partner Michael Sanders, who acted alongside Milbank partner Julian Stait, who advised on US aspects.

Tesco is the only retailer to have settled on interchange fee litigation, which is continuing against both Visa and MasterCard this year, brought by a consortium of UK and European retailers.

Humphries Kerstetter is also representing WHSmith to sue Visa and MasterCard for £17.5m and £5.5m respectively.

Mishcon de Reya is acting for Ocado and Sainsbury’s against MasterCard; Morgan Lewis is acting for Sainsbury’s against Visa; Stewarts Law is acting for Arcadia Group, Marks & Spencer and 10 other retailers; Gowling WLG is representing Dixons; and Hausfeld is representing European retailers including Hertz, Deutsche Bahn and Metro.

Sainsbury’s won its claim against MasterCard in September, with the Competition Appeal Tribunal (CAT) ruling the payment processor must pay it £68.5m in damages. The ruling was the first major interchange fee decision in the competition court. MasterCard has retained its lawyers Jones Day to appeal the decision.

MasterCard has also now been hit by a £14bn class action over allegations related to interchange fees, including how retailers passed the extra charges onto customers.

Quinn Emanuel Urquhart & Sullivan is representing the claimant Walter Merricks, who is suing on behalf of 65 million consumers. The claim will go to its first case management conference next Monday (21 November). MasterCard has instructed Freshfields Bruckhaus Deringer for its defence.