District Court grants final approval of $10 million class action settlement

Courts Class Action Fees Consumer Finance Settlement

On April 11, the U.S. District Court for the Eastern District of New York granted final approval to a $10 million class action settlement resolving allegations that a defendant bank breached its payment card processing servicing contracts with merchants by imposing excessive fees without contractually required notice. Additionally, the plaintiffs alleged that the defendant was “unjustly enriched by imposing early termination fees that constituted unlawful penalties.” The settlement class includes over 200,000 merchants that entered into a payment card processing servicing contract with the defendant and who paid at least one of the fees underlying the litigation from October 2011 to the settlement date. Those fees include annual fees, early termination fees, and paper statement fees. According to the memorandum in support of the unopposed motion for preliminary approval of class settlement, the deal would provide $10 million in cash to the settlement class, and attorneys representing the class can seek up to one-third of that fund in attorneys’ fees. In addition, each of the three class representatives will be granted $10,000 service awards, per the motion.