SAN FRANCISCO (dpa-AFX) - Visa Inc. (V) announced that the company, MasterCard Inc. (MA) and U.S. financial institution defendants have signed a memorandum of understanding to enter into a settlement agreement to resolve the Class Plaintiffs' claims in the multi-district interchange litigation or MDL. The claims originally were brought by a class of U.S. retailers in 2005.
Visa said it also has reached an agreement in principle to resolve the claims brought against Visa by a group of individual retailers in the same MDL litigation. The proposed settlement payments for both the Class and Individual claims would be approximately $6.6 billion, of which Visa's share would represent approximately $4.4 billion. Visa said its share will be paid from the litigation escrow account established pursuant to Visa's Retrospective Responsibility Plan.
The settlement agreement with the Class Plaintiffs included, Modifications to Visa's rules to permit retailers to impose a surcharge on credit transactions subject to a cap and a level playing field with other general purpose card competitors. The rule changes on surcharging likely would be implemented in early 2013.
For the quarter ending June 30, 2012, Visa intends to record a litigation charge of approximately $4.1 billion, which will increase its total FAS 5 reserve for the litigation covered by the Retrospective Responsibility Plan from $285 million to approximately $4.4 billion, to reflect the Class Plaintiffs' Settlement Agreement and management's current estimate to resolve the Individual Plaintiffs' claims.
Visa noted that it remains in a 'quiet period' which will extend until the Company's fiscal third quarter 2012 earnings are released on July 25, 2012.
Copyright RTT News/dpa-AFX
Kostenloser Wertpapierhandel auf Smartbroker.de