UK consumers fight back against Mastercard in historic class action trial!

In a riveting legal battle against Mastercard, a monumental class action lawsuit had been anticipated to be the largest of its kind in the UK. The lawsuit had the potential to award the majority of the population with substantial compensation for what was perceived as overcharging by the global payment behemoth. However, after eight long years of legal wrangling, the grand dreams of a hefty payout for tens of millions of individuals, as well as the looming threat of a multi-billion pound bill for Mastercard, failed to come to fruition.

The US company recently brokered an initial agreement to settle the lawsuit initiated by former financial ombudsman Walter Merricks on behalf of approximately 46 million consumers, for a mere £200 million – a far cry from the astounding £14 billion originally sought by the claimants. Although the specifics of the settlement, including the distribution of the settlement pot, are still pending confirmation, the headline figure suggests a mere pittance per eligible claimant.

Here’s an overview of the key points surrounding this groundbreaking lawsuit:

• The settlement has stirred a public spat between Merricks and the financial backer of the case, Innsworth, owned by US hedge fund Elliott, who deemed the agreed sums as inadequate.
• The legal battle against Mastercard reflects a broader scrutiny on the nascent class action system in the UK, lauded by some as a crucial mechanism to hold companies accountable, but critiqued by others for its protracted nature and relatively small payouts.
• Claims brought under this new system have faced significant delays due to procedural arguments, leading critics to question the efficacy of such litigation in providing meaningful redress for aggrieved consumers.
• Despite the settlement amount being significantly lower than anticipated, some argue that the class action regime provides access to justice and acts as a deterrent to anti-competitive practices.
• The lawsuit against Mastercard alleged the imposition of unlawful fees on transactions processed through its network, leading the company to express relief at reaching an agreement in principle.

The legal landscape surrounding class action lawsuits in the UK remains largely uncharted but is poised for further developments. The forthcoming judgments in high-profile cases, like the £1.3 billion claim against BT for overcharging landline customers, will shed more light on the potential outcomes and consumer recompense.

Executives navigating the threat of class actions in the UK should not find solace in the settlement of the Mastercard case. Each lawsuit presents a unique challenge, and funders continue to show interest in such cases. While the outcome of this particular case may give pause to funders, it’s evident that the appetite for pursuing class actions remains unabated.

In conclusion, the Mastercard case may not have yielded the anticipated windfall for millions of consumers, but it has paved the way for significant discourse and reviews within the UK class action landscape. As future settlements and rulings unfold, the efficacy of the class action regime in providing adequate redress to consumers will become clearer. For now, the legal arena remains abuzz with anticipation and the promise of justice for those wronged by corporate malpractices.