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Funder opposes British Mastercard settlement

A settlement agreement in a British mass-consumer claim against payments company Mastercard is already facing a challenge from a litigation funder in the case, according to the Law Society Gazette of England and Wales.

The claim, by former financial ombudsman Walter Merricks as class representative of 46 million people, had sought £17 billion in compensation for excessive transactional fees.

The first mass-consumer action to be approved in Britain, it was given the green light by the Supreme Court in 2020.

It emerged last night (3 December), however, that a settlement had been reached, according to the Gazette.

‘Meaningful compensation'

In a statement this morning Merricks said: “I am very pleased that after nearly nine years of litigation with Mastercard, I have agreed a settlement that I believe will deliver meaningful compensation to class members who chose to come forward to participate in the distribution of the damages.

“I now look forward to presenting the details of the settlement to the [Competition Appeal] Tribunal (CAT) for its consideration and approval,” he concluded.

The Gazette also quoted Mastercard as saying: “We are pleased to have reached an agreement in principle to put this case behind us.”

The agreement, for a figure so far undisclosed but reported to be Stg £200 million, is conditional on approval by the CAT. A hearing is expected early next year.

‘Too low’

Litigation funder Innsworth immediately criticised the settlement. It said: “We strongly oppose this reported settlement which was struck without our agreement. It is both too low and premature.”

According to the Gazette, Innsworth said that the funder would be challenging the deal, and that it had already written to the CAT.

“Both Walter Merricks and [legal representative] Boris Bronfintrenker have repeatedly claimed this is a billion-pound case, yet they seemed to have rushed to settle for a reported £200 million, raising some serious questions,” it stated.