UNITED STATES DISTRICT COURT|
EASTERN DISTRICT OF NEW YORK
IN RE VISA CHECK/MASTERMONEY
This document relates to: ALL ACTIONS
MASTER FILE NO. CV-96-5238
(Gleeson, J.) (Orenstein, M.J.)
AGREEMENT WITH RESPECT TO U.S. GOVERNMENT MERCHANT CLAIMS
The parties to this Agreement, by their undersigned counsel, hereby agree, subject to the
approval of the Court, as follows:
- The United States, acting through its attorneys at the direction of the Attorney
General, filed a memorandum of law seeking a ruling based on equitable principles that would
allow U.S. Governmental agencies and instrumentalities that had accepted Visa and MasterCard
branded debit and credit cards during the Class Period and had submitted timely claims and had
not withdrawn such claims (hereinafter "Government Merchants") to participate in the
distribution of the Net Settlement Funds in this case. The government's application was
supported by Defendants Visa U.S.A. Inc. ("Visa") and MasterCard International Incorporated
("MasterCard"), but was opposed by Lead Counsel for the Class. Prior to any ruling by the
Court on the government's application, the parties have agreed to compromise and resolve their
differences on the terms set forth herein.
- Within 90 days after entry of an Order approving this Agreement or the expiration
of any timely appeals from such Order, whichever is later, the Claims Administrator shall make a
payment from the Net Settlement Funds to the United States Department of the Treasury
("Treasury") in an amount equal to 34% of the Government Merchants' signature debit and
credit card claims. Lead Counsel for the Class and the United States understand and agree that
such payment will be based on the estimate that these claims are $9,851,324 and do not exceed
$10 million, and the payment will therefore not exceed $3.4 million.
- The Claims Administrator shall make a payment from the Net Settlement Funds
to the Treasury in an amount equal to 34% of the Government Merchants' online PIN debit
claims. Lead Counsel for the Class and the United States understand and agree that such
payment will be based on the estimate that these claims are a total of $1,065,207. This payment
shall be made in 2007 at the same time as payments are made to Class Members on their online
PIN debit claims or as soon as reasonably practicable following the expiration of any timely
appeals from an Order approving this Agreement.
- With respect to any and all additional or residual distributions, the Claims
Administrator shall make one or more payments from the Net Settlement Funds to the Treasury
at the same time as payments are made to Class Members or as soon as reasonably practicable
following the expiration of any timely appeals. With respect to all such payments, the Claims
Administrator shall treat the Government Merchants as if they were Class Members and shall not
discount their claims.
- Visa shall pay $2 million to the Treasury in two equal installments of $1 million
each. The first payment shall be made within 60 days after entry of an Order approving this
agreement or the expiration of any timely appeals from such Order, whichever is later. The
second payment shall be made on or before the one year anniversary of the first payment.
- MasterCard shall pay $1.5 million to the Treasury in four equal installments of
$375,000 each. The first payment shall be made within 60 days after entry of an Order
approving this agreement or the expiration of any timely appeals from such Order, whichever is
later. The second, third and fourth payments shall be made respectively on or before the one
year, two year and three year anniversaries of the first payment.
- The Government Merchants in their commercial capacities agree to the release as
set forth in paragraph 28 of the Visa Settlement Agreement dated June 4, 2003 (with respect to
Visa), and to the release as set forth in paragraph 30 of the MasterCard Settlement Agreement
dated June 4, 2003 (with respect to MasterCard), with the following clarification: The
Government Merchants are solely releasing claims for monetary compensation that could have
been asserted under 15 U.S.C. § 15a or otherwise for alleged violations of any federal or state
antitrust, unfair competition, or unfair practices law. Nothing in the aforementioned Settlement
Agreements, any Order of this Court in this proceeding, or this Agreement shall affect the law
enforcement responsibilities of the United States, and its rights to investigate, obtain evidence,
and prosecute any civil or criminal violations of the law, including violations of the federal
antitrust laws, and to obtain civil or criminal penalties or fines for such violations.
- The parties affirm that (i) Lead Counsel for the Class has not purported to
represent the sovereign law enforcement interests of the United States; and (ii) the United States
has not exercised authority over the prosecution of this action or the Settlement Agreements
dated June 4, 2003.
- Defendants agree not to seek reimbursement from the United States or any of its
agencies of any payments made to the Government Merchants under this Agreement, or any
other costs or expenses associated with this litigation. Nothing herein shall limit the right of
Visa and MasterCard to continue to conduct business with the United States and its
instrumentalities in the ordinary course of business, including, but not limited to, adjustments to
interchange fees of general applicability to merchants similarly situated.
- All payments shall be made by wire transfer to a bank account specified by the
Treasury, which shall then be solely responsible for the distribution of the funds among the
- Any disputes relating to this Agreement shall be referred to Special Master Robin
Wilcox for resolution.
- The United States has executed this Agreement under the discretion of the
Attorney General, for settlement purposes only. Each of the signatories to this Agreement
represents that he or she has full power and authority to enter into this Agreement.
DATED: December 29, 2006
LEAD COUNSEL FOR THE CLASS
Lloyd Constantine (LC 8465)
CONSTANTINE CANNON, P.C.
450 Lexington Avenue – 17th Floor
New York, NY 10017
|VISA U.S.A. INC.
Stephen V. Bomse (SB 6594)
HELLER EHRMAN LLP
333 Bush Street
San Francisco, CA 94104
UNITED STATES OF AMERICA
Allen P. Grunes (AG 4775)
U.S. Department of Justice
325 Seventh St., N.W.
Washington, DC 20530
MASTERCARD INTERNATIONAL INCORPORATED
Joseph F. Tringali (JT 9575)
SIMPSON THACHER & BARTLETT
425 Lexington Avenue
New York, NY 10017