EX-10.3 2 exhibit103123112.htm DEFINITIVE CLASS SETTLEMENT AGREEMENT Exhibit 10.3

Exhibit 10.3

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

 

 

IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT

DISCOUNT ANTITRUST LITIGATION

 

This Document Applies to: All Cases.

 

  

 

 

No. 05-MD-1720 (JG) (JO)

DEFINITIVE CLASS SETTLEMENT AGREEMENT


Table of Contents

 

     Page  

Preamble

     1   

Definitions

     6   

Settlement Classes

     18   

Class Settlement Escrow Account(s)

     19   

Payments to the Class Settlement Escrow Accounts

     20   

Payments from the Class Settlement Escrow Account(s)

     24   

Consideration Provided to Members of the Rule 23(b)(3) Settlement Class

     29   

Release and Covenant Not to Sue of the Rule 23(b)(3) Settlement Class

     31   

Consideration Provided to Members of the Rule 23(b)(2) Settlement Class

     39   

Visa Rules Modifications

     39   

MasterCard Rules Modifications

     53   

Release and Covenant Not to Sue of the Rule 23(b)(2) Settlement Class

     66   

Preliminary Court Approval

     75   

Class Settlement Notice and Exclusion Procedures

     78   

Final Court Approval

     86   

Termination

     90   

Continuing Jurisdiction

     92   

Additional Terms and Conditions

     94   

APPENDIX A — Class Actions in MDL 1720

     A-1   

APPENDIX B — Class Settlement Cash Escrow Account(s)

     B-1   

APPENDIX C — Class Settlement Interchange Escrow Account(s)

     C-1   

APPENDIX D — Class Settlement Preliminary Approval Order

     D-1   

 

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     Page  

APPENDIX E — Notice Plan

     E-1   

APPENDIX F — Settlement Class Notices

     F-1   

APPENDIX G — Class Settlement Order and Final Judgment

     G-1   

APPENDIX H — Counsel Names and Contact Information

     H-1   

APPENDIX I — Plan of Administration and Distribution

     I-1   

APPENDIX J — Final Judgment in United States v. American Express

     J-1   

 

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

 

 

IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT DISCOUNT ANTITRUST LITIGATION

 

This Document Applies to: All Cases.

 

  

 

 

No. 05-MD-1720 (JG) (JO)

DEFINITIVE CLASS SETTLEMENT AGREEMENT

Subject to the preliminary and final approval of the Court, and as further set forth below, this Definitive Class Settlement Agreement (“Class Settlement Agreement”) is made as of the 19th day of October, 2012, by and between the Class Plaintiffs defined below, individually and as representatives of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class defined below, Class Counsel defined below, and the Defendants defined below.

WHEREAS, on June 22, 2005, Photos Etc. Corporation, Traditions Ltd., CHS Inc., and other plaintiffs filed a class action complaint in Photos Etc. Corp., et al. v. Visa U.S.A. Inc., et al., No. 05-CV-01007 (D. Conn.), alleging, among other things, that Defendants unlawfully fixed interchange fees and engaged in other conduct in violation of Section 1 of the Sherman Act (15 U.S.C. § 1, et seq.);

WHEREAS, the Photos Etc. Corp. action was subsequently consolidated for pretrial proceedings with additional putative class actions and individual plaintiff actions alleging similar or identical claims, in In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, No. 05-MD-1720-JG-JO (E.D.N.Y.) (MDL 1720), pending before Judge John Gleeson and Magistrate Judge James Orenstein in the United States District Court for the Eastern District of New York;

WHEREAS, on February 24, 2006, the Court filed Pretrial Order No. 5, which designated the law firms of Robins, Kaplan, Miller & Ciresi L.L.P., Berger & Montague, P.C., and Lerach

 

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Coughlin Stoia Geller Rudman & Robbins LLP (now known as Robbins Geller Rudman & Dowd LLP) as co-lead counsel for the class plaintiffs;

WHEREAS, on April 24, 2006, the Class Plaintiffs filed a First Consolidated Amended Class Action Complaint, and on July 5, 2006, filed a First Supplemental Class Action Complaint;

WHEREAS, on or about June 9 and July 6, 2006, the Defendants filed answers in which each Defendant asserted defenses to the Class Plaintiffs’ claims, denied that the Defendant had violated any law or other duty, and denied each of the Class Plaintiffs’ claims of liability, wrongdoing, injuries, damages, and entitlement to any relief;

WHEREAS, on September 7, 2007, Magistrate Judge Orenstein filed a Report and Recommendation granting the Defendants’ motion to dismiss the Class Plaintiffs’ claims for damages incurred prior to January 1, 2004, which Judge Gleeson adopted in an Order filed on January 8, 2008;

WHEREAS, on November 25, 2008, Judge Gleeson filed an Order granting certain Defendants’ motion to dismiss the First Supplemental Class Action Complaint, with leave to replead;

WHEREAS, on May 8, 2008, the Class Plaintiffs filed a motion for certification of a class under Federal Rule of Civil Procedure 23(b)(3) and for certification of a class under Federal Rule of Civil Procedure 23(b)(2), on which Magistrate Judge Orenstein heard argument on November 19, 2009;

WHEREAS, on February 20, 2009, the Class Plaintiffs filed the currently operative Second Consolidated Amended Class Action Complaint, First Amended Supplemental Class Action Complaint, and Second Supplemental Class Action Complaint;

WHEREAS, in those complaints, as in their prior complaints, the Class Plaintiffs allege that one or more of the Defendants engaged in conduct in violation of the Sherman Act (15

 

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U.S.C. § 1 et seq.), the Clayton Act (15 U.S.C. § 12 et seq.), the Cartwright Act (Cal. Bus. & Prof. Code § 16700 et seq.), and the New York Uniform Fraudulent Conveyance Act (N.Y. Debt. & Cred. Law. § 270 et seq.), alleging that Defendants adopted interchange rules and rates, other network rules, and corporate reorganizations, which constituted unlawful price fixing, unreasonable restraints of trade, monopolization, lessening of competition, and fraudulent conveyances, and which injured the Class Plaintiffs and other merchants in the asserted Rule 23(b)(3) class and the asserted Rule 23(b)(2) class in accepting Visa-Branded Cards and/or MasterCard-Branded Cards as payment for goods or services;

WHEREAS, the Class Plaintiffs have sought relief, including but not limited to damages, injunctive relief, attorneys’ fees, and costs for the alleged conduct of the Defendants;

WHEREAS, on March 31, 2009, the Defendants filed motions to dismiss the Second Consolidated Amended Class Action Complaint, the First Amended Supplemental Class Action Complaint, and the Second Supplemental Class Action Complaint, on which Magistrate Judge Orenstein heard argument on November 18, 2009;

WHEREAS, the Class Plaintiffs reviewed more than 50 million pages of documents in discovery and deposed more than 400 witnesses, including the Defendants’ experts;

WHEREAS, on February 11, 2011, the Defendants served a motion for summary judgment seeking the dismissal of the claims asserted in the Operative Class Complaints, on which Judge Gleeson heard argument on November 2, 2011;

WHEREAS, on February 11, 2011, the Class Plaintiffs served a motion seeking summary judgment on liability on certain claims asserted against the Defendants in the Operative Class Complaints, on which Judge Gleeson heard argument on November 2, 2011;

 

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WHEREAS, on February 11, 2011, Defendants and Class Plaintiffs filed motions to disqualify certain of the other side’s proffered experts, on which Magistrate Judge Orenstein heard argument on November 2, 2011;

WHEREAS, as a result of arm’s-length negotiations over several years, including numerous mediation sessions before the Honorable Edward A. Infante and Professor Eric Green, as well as sessions before the Court with the consent of all Class Plaintiffs and Defendants, the Class Plaintiffs and the Defendants have entered into this Class Settlement Agreement;

WHEREAS, the Class Plaintiffs, Class Counsel, and Class Plaintiffs’ other counsel who have appeared in this Action have conducted substantial discovery, have investigated the facts and underlying events relating to the subject matter of their claims, have carefully analyzed the applicable legal principles, and have concluded, based upon their investigation, and taking into account the risks, uncertainties, burdens, and costs of further prosecution of their claims, and taking into account the substantial benefits to be received pursuant to this Class Settlement Agreement as set forth below, which, in the view of the Class Plaintiffs and their counsel, are designed to enable the alleged markets for payment card acceptance services to function competitively in the future, and for the purpose of putting to rest all controversies with the Defendants that were or could have been alleged, that a resolution and compromise on the terms set forth herein is fair, reasonable, adequate, and in the best interests of the Class Plaintiffs, the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class;

WHEREAS, the Class Plaintiffs and Class Counsel believe that the modifications of the Visa and MasterCard Rules addressed below in this Class Settlement Agreement will improve competition in the alleged markets for payment card acceptance services;

WHEREAS, the Class Plaintiffs and Class Counsel have developed a Notice Plan that they believe satisfies the requirements of due process and Federal Rule of Civil Procedure 23,

 

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and that is in the interests of all parties and all released parties, and a Plan of Administration and Distribution that, pursuant to a claims-made process, will fairly and adequately administer the settlement and allocate among, and distribute the settlement proceeds to, members of the Rule 23(b)(3) Settlement Class;

WHEREAS, the Defendants, for the purpose of avoiding the burden, expense, risk, and uncertainty of continuing to litigate the Class Plaintiffs’ claims, and for the purpose of putting to rest all controversies with the Class Plaintiffs, the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class that were or could have been alleged, and without any admission of liability or wrongdoing whatsoever, desire to enter into this Class Settlement Agreement;

WHEREAS, Class Counsel represent and warrant that they are fully authorized to enter into this Class Settlement Agreement on behalf of the Class Plaintiffs and Class Plaintiffs’ other counsel who have participated in any settlement conferences before the Court for a Class Plaintiff that executes this Class Settlement Agreement, and that Class Counsel have consulted with and confirmed that all Class Plaintiffs fully support and have no objection to this Class Settlement Agreement; and

WHEREAS, it is agreed that this Class Settlement Agreement shall not be deemed or construed to be an admission, concession, or evidence of any violation of any federal, state, or local statute, regulation, rule, or other law, or principle of common law or equity, or of any liability or wrongdoing whatsoever, by any of the Defendants, or any of the Rule 23(b)(3) Settlement Class Released Parties or Rule 23(b)(2) Settlement Class Released Parties defined below, or any of their alleged co-conspirators, or of the truth of any of the claims that the Class Plaintiffs have asserted;

NOW, THEREFORE, without any admission or concession by the Class Plaintiffs of any lack of merit to their allegations and claims, and without any admission or concession by the

 

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Defendants of any liability or wrongdoing or lack of merit in their defenses, in consideration of the mutual covenants and terms contained herein, and subject to the final approval of the Court, the Class Plaintiffs, Class Counsel, and the Defendants agree as follows:

Definitions

1. For the purposes of this Class Settlement Agreement, the following words and terms shall be defined to have the meanings set forth below, and all undefined words and phrases shall have their usual and customary meaning.

(a) “Action,” “this Action,” or “MDL 1720” means all actions that are consolidated for pretrial proceedings in In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, 05-MD-01720 (E.D.N.Y.) (JG) (JO).

(b) “Attorneys’ Fee Awards” means all attorneys’ fees that are awarded by the Court to Class Counsel or other counsel in the Class Actions for work performed for the benefit of members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, but not including Expense Awards, Class Plaintiffs’ Awards, or Settlement Administration Costs.

(c) “Authorized Cash Claimant” means a member of the Rule 23(b)(3) Settlement Class that is entitled to receive a payment from the Net Cash Settlement Fund in the Class Settlement Cash Escrow Account(s) as provided in the Plan of Administration and Distribution. No Individual Plaintiff shall be an Authorized Cash Claimant within the meaning of this Class Settlement Agreement.

(d) “Authorized Interchange Claimant” means a member of the Rule 23(b)(3) Settlement Class that is entitled to receive a payment from the Net Interchange Settlement Fund in the Class Settlement Interchange Escrow Account(s) as provided in the Plan of Administration and Distribution. No Individual Plaintiff shall be an Authorized Interchange Claimant within the meaning of this Class Settlement Agreement.

 

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(e) “Bank Defendants” means Bank of America, N.A.; BA Merchant Services LLC (formerly known as National Processing, Inc.); Bank of America Corporation; MBNA America Bank, N.A.; Barclays Bank plc; Barclays Bank Delaware; Barclays Financial Corp.; Capital One Bank (USA), N.A.; Capital One F.S.B.; Capital One Financial Corporation; Chase Bank USA, N.A.; Chase Manhattan Bank USA, N.A.; Chase Paymentech Solutions, LLC; JPMorgan Chase Bank, N.A.; JPMorgan Chase & Co.; Bank One Corporation; Bank One Delaware, N.A.; Citibank (South Dakota), N.A.; Citibank N.A.; Citigroup Inc.; Citicorp; Fifth Third Bancorp; First National Bank of Omaha; HSBC Finance Corporation; HSBC Bank USA, N.A.; HSBC North America Holdings Inc.; HSBC Holdings plc; HSBC Bank plc; National City Corporation; National City Bank of Kentucky; SunTrust Banks, Inc.; SunTrust Bank; Texas Independent Bancshares, Inc.; Wachovia Bank, N.A.; Wachovia Corporation; Washington Mutual, Inc.; Washington Mutual Bank; Providian National Bank (also known as Washington Mutual Card Services, Inc.); Providian Financial Corporation; Wells Fargo Bank, N.A. and Wells Fargo & Company.

(f) “Case Website” means the dedicated website, www.PaymentCardSettlement.com, established for the purposes of this case, which is described in Paragraph 80 below.

(g) “Class Actions” means all actions styled as putative class actions in MDL 1720, which are listed in Appendix A hereto.

(h) “Class Administrator” means Epiq Systems, Inc., which shall effectuate and administer the Notice Plan, the exclusion process for Opt Outs, and the claims process and distribution for the members of the Rule 23(b)(3) Settlement Class, and which shall analyze and evaluate the amount of any Class Exclusion Takedown Payments or Default Interchange Payments, all under the supervision of Class Counsel and the Court, and which firm is unrelated

 

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to and independent of the Class Plaintiffs and the Defendants within the meaning of Treasury Regulations § 1.468B-1(d) and § 1.468B-3(c)(2)(A).

(i) “Class Counsel” means the law firms of Robins, Kaplan, Miller & Ciresi L.L.P., Berger & Montague, P.C., and Robbins Geller Rudman & Dowd LLP.

(j) “Class Exclusion Period” means the period in which a member of the Rule 23(b)(3) Settlement Class may timely and properly become an Opt Out, which period is specified in Paragraph 83 below.

(k) “Class Exclusion Takedown Payments” means the payment to be made to the Visa Defendants and the payment to be made to the MasterCard Defendants from the Class Settlement Cash Escrow Account(s) pursuant to Paragraphs 17-20 below. No such payments shall be made from the Class Settlement Interchange Escrow Account(s).

(l) “Class Objection Period” means the period in which a member of the Rule 23(b)(3) Settlement Class or a member of the Rule 23(b)(2) Settlement Class must file any objections to this Class Settlement Agreement, which period is specified in Paragraph 85 below.

(m) “Class Plaintiffs” means the following plaintiffs named in the Operative Class Complaints in MDL 1720: Photos Etc. Corporation; Traditions, Ltd.; Capital Audio Electronics, Inc.; CHS Inc.; Crystal Rock LLC; Discount Optics, Inc.; Leon’s Transmission Service, Inc.; Parkway Corp.; and Payless ShoeSource, Inc..

(n) “Class Plaintiffs’ Awards” means any incentive or service awards that the Court orders to be paid to a Class Plaintiff, but not including Attorneys’ Fee Awards, Expense Awards, or Settlement Administration Costs.

(o) “Class Settlement Agreement” means this Definitive Class Settlement Agreement, including all of its Appendices.

 

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(p) “Class Settlement Cash Escrow Account(s)” means the bank account or accounts established pursuant to the escrow agreement or agreements in Appendix B hereto, as provided in Paragraph 6 below.

(q) “Class Settlement Interchange Escrow Account(s)” means the bank account or accounts established pursuant to the escrow agreement or agreements in Appendix C hereto, as provided in Paragraph 6 below.

(r) “Class Settlement Order and Final Judgment” means the Court’s order finally approving the Class Settlement Agreement and the final judgment dismissing all putative class action complaints in MDL 1720 with prejudice, which is described in Paragraph 95 below and is contained in Appendix G hereto.

(s) “Class Settlement Preliminary Approval Order” means the Court’s order preliminarily approving this Class Settlement Agreement, which is described in Paragraph 76 below and is contained in Appendix D hereto.

(t) “Court” means the United States District Court for the Eastern District of New York.

(u) “Credit Card” means any card, plate, or other payment code, device, or service, even where no physical card is issued and the code or device is used for only one transaction — including, without limitation, a plastic card, a mobile telephone, a fob, or any other current or future code, device, or service by which a person, business, or other entity can pay for goods or services — that is issued or approved for use through a payment network and that may be used to defer payment of debt or incur debt and defer its payment, including cards commonly known as credit cards, charge cards, commercial credit cards, corporate credit cards, fleet cards, or purchasing cards.

 

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(v) “Debit Card” means any card, plate, or other payment code or device, even where no physical card is issued and the code or device is used for only one transaction — including, without limitation, a plastic card, a mobile telephone, a fob, or any other current or future device by which a person, business, or other entity can pay for goods or services — that is issued or approved for use through a payment network to debit an asset account, or that otherwise is not a Credit Card, regardless of whether authorization is based on signature, personal identification number (or PIN), or other means, and regardless of whether or not the issuer holds the account (such as decoupled debit), including cards commonly known as signature or offline debit cards, PIN or online debit cards, gift cards, or other prepaid cards.

(w) “Default Interchange Payments” means the payment to be made by the Visa Defendants and the payment to be made by the MasterCard Defendants pursuant to Paragraphs 11-13 below.

(x) “Defendants” means the Visa Defendants, the MasterCard Defendants, and the Bank Defendants.

(y) “Escrow Agent(s)” means The Huntington National Bank, which shall maintain, administer, and make payments from the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s) as provided in this Class Settlement Agreement and Appendices B and C, and which shall be unrelated to and independent of the Class Plaintiffs and the Defendants within the meaning of Treasury Regulations § 1.468B-1(d) and § 1.468B-3(c)(2)(A).

(z) “Expense Awards” means all costs and expenses, including any fees and costs for experts and consultants, that are awarded by the Court for the work performed for the benefit of members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class,

 

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but not including Attorneys’ Fee Awards, Class Plaintiffs’ Awards, or Settlement Administration Costs.

(aa) “Individual Plaintiffs” means the following entities to the extent that they are or have been plaintiffs in the Action as of the date of execution of this Class Settlement Agreement: Ahold U.S.A., Inc.; Albertson’s Inc.; BI-LO, LLC; Bruno’s Supermarkets, Inc.; Delhaize America, Inc.; Eckerd Corporation; The Great Atlantic & Pacific Tea Company; H.E. Butt Grocery Company; Hy-Vee, Inc; The Kroger Co.; Maxi Drug, Inc. (and doing business as Brooks Pharmacy); Meijer, Inc.; Meijer Stores Limited Partnership; Pathmark Stores, Inc.; Publix Supermarkets, Inc.; QVC, Inc.; Raley’s; Rite Aid Corporation; Safeway, Inc.; Supervalu Inc.; Wakefern Food Corporation; and Walgreen Co.

(bb) “MasterCard-Branded Card” means any Credit Card or Debit Card that bears or uses the name MasterCard, Maestro, Cirrus, or any other brand name or mark owned or licensed by a MasterCard Defendant, or that is issued under any such brand or mark.

(cc) “MasterCard Defendants” means MasterCard International Incorporated and MasterCard Incorporated, and each of their respective subsidiaries, successors, purchasers, and assigns (including an acquirer of all or substantially all of their respective assets, stock, or other ownership interests).

(dd) “Merchant Fee” means any sum that is deducted from the funds that a merchant receives in the settlement of a Credit Card or Debit Card transaction, or is otherwise charged to or paid by a merchant, or any interchange fee, network fee or assessment, or acquirer, issuer, or processor fee, and includes Visa’s Fixed Network Acquirer Fee except as provided in Paragraph 72(d) below.

(ee) “Net Cash Settlement Fund” means the amount deposited into the Class Settlement Cash Escrow Account(s) pursuant to Paragraph 10 below less (i) the Taxes and

 

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administrative costs related to the accounts, (ii) the Class Exclusion Takedown Payments, and (iii) any payments approved by the Court, including for Attorneys’ Fee Awards, Expense Awards, Class Plaintiffs’ Awards, and Settlement Administration Costs.

(ff) “Net Interchange Settlement Fund” means the amount deposited into the Class Settlement Interchange Escrow Account(s) pursuant to Paragraphs 11-13 below less (i) the Taxes and administrative costs related to those accounts, and (ii) any payments approved by the Court, including for Attorneys’ Fee Awards, Expense Awards, and Settlement Administration Costs.

(gg) “Notice Plan” means the plan for providing notice of this Action and this Class Settlement Agreement to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, which is contained in Appendix E hereto.

(hh) “Objector” means any member of either the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, or any member of both the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, that timely and properly submits an objection to this Class Settlement in the manner provided in Paragraphs 85-87 below.

(ii) “Operative Class Complaints” means the Second Consolidated Amended Class Action Complaint, the First Amended Supplemental Class Action Complaint, and the Second Supplemental Class Action Complaint, filed in this Action on or about February 20, 2009.

(jj) “Opt Out” means a member of the Rule 23(b)(3) Settlement Class that timely and properly excludes itself, himself, or herself from the Rule 23(b)(3) Settlement Class in accordance with the procedures approved by the Court. The Individual Plaintiffs are not Opt Outs for purposes of calculating the Class Exclusion Takedown Payments, as provided in Paragraphs 17-20 below.

 

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(kk) “Paragraph” or “Paragraphs” means one or more paragraphs of this Class Settlement Agreement.

(ll) “Plan of Administration and Distribution” means the plan for administering claims made by Authorized Cash Claimants to the Net Cash Settlement Fund and distributing the Net Cash Settlement Fund to Authorized Cash Claimants, and the plan for administering claims made by Authorized Interchange Claimants to the Net Interchange Settlement Fund and distributing the Net Interchange Settlement Fund to Authorized Interchange Claimants, attached hereto as Appendix I.

(mm) “Rule” means any rule, by-law, policy, standard, guideline, operating regulation, practice, procedure, activity, or course of conduct relating to any Visa-Branded Card or any MasterCard-Branded Card.

(nn) “Rule 23(b)(2) Settlement Class” means the members of the settlement class defined in Paragraph 2(b) below, from which no exclusions will be permitted.

(oo) “Rule 23(b)(2) Settlement Class Released Parties” means the persons, businesses, or other entities described in Paragraph 67 below.

(pp) “Rule 23(b)(2) Settlement Class Releasing Parties” means the persons, businesses, or other entities described in Paragraph 66 below.

(qq) “Rule 23(b)(3) Settlement Class” means the members of the settlement class as defined in Paragraph 2(a) below and, after the end of the Class Exclusion Period, excluding those members who have become Opt Outs.

(rr) “Rule 23(b)(3) Settlement Class Released Parties” means the persons, businesses, or other entities described in Paragraph 32 below.

(ss) “Rule 23(b)(3) Settlement Class Releasing Parties” means the persons, businesses, or other entities described in Paragraph 31 below.

 

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(tt) “Settlement Administration Costs” means the expenses incurred in the administration of this Class Settlement Agreement, including all amounts awarded by the Court for costs associated with providing notice to the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, locating members of those classes or determining their eligibility to be an Authorized Cash Claimant and/or an Authorized Interchange Claimant, calculating or verifying the amount of the Class Exclusion Takedown Payments or Default Interchange Payments, obtaining information regarding the claims of members of the Rule 23(b)(3) Settlement Class, administering, calculating, and distributing the Net Cash Settlement Fund to Authorized Cash Claimants and the Net Interchange Settlement Fund to Authorized Interchange Claimants, other costs of claims administration, payment of Taxes or administration costs with respect to the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Accounts as provided in Paragraph 7 below, and other reasonable third-party fees and expenses incurred by the Class Administrator in connection with prosecuting, handling, and settling the Class Actions, and administering the terms of this Class Settlement Agreement, that are not categorized as Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards.

(uu) “Settlement Class Notices” means the long-form and publication notices concerning this Action and this Class Settlement Agreement to be provided to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, which are contained in Appendix F hereto.

(vv) “Settlement Final Approval Date” means the business day after all of the following conditions have been satisfied: (i) notice of the Class Settlement Agreement has been provided to the members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class as provided in Paragraphs 79-93 below and ordered by the Court; and (ii) the Court has entered the Class Settlement Order and Final Judgment without material modification from the

 

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form of the attached Appendix G hereto, including without any modification of the certification for the purposes of settlement of the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class (from which exclusions are not permitted), and including without any modification of the releases and covenants not to sue provided by those settlement classes.

(ww) “Settlement Final Date” means the business day after all of the following conditions have been satisfied: (i) the Court has entered the Class Settlement Order and Final Judgment without material modification from the form of the attached Appendix G hereto, including without any modification of the certification for the purposes of settlement of the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class (from which exclusions are not permitted), and including without any modification of the releases and covenants not to sue provided by those settlement classes; (ii) in the event that there is an appeal from the Court’s Class Settlement Order and Final Judgment, it is affirmed without material modification, including without any modification of the certification for the purposes of settlement of the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class (from which exclusions are not permitted), and including without any modification of the releases and covenants not to sue provided by those settlement classes; and (iii) the Class Settlement Order and Final Judgment is no longer subject to further court review by rehearing, appeal, petition for certiorari, or otherwise. The Class Settlement Order and Final Judgment shall be deemed to be no longer subject to further court review either (x) seventy-five days after the Class Settlement Order and Final Judgment has been entered by the Court if no notice, motion, or other document is filed within that time seeking any rehearing, reconsideration, vacation, review, appeal, or any other action regarding the Class Settlement Order and Final Judgment or this Class Settlement Agreement, or (y) if any such notice, motion, or document is filed, then ten business days after the date on which all appellate and/or other proceedings resulting from any such notices,

 

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motions, or documents have been finally terminated or resolved without modification of the Class Settlement Order and Final Judgment or this Class Settlement Agreement and in such a manner as to permit no further judicial action, challenge, modification, or review of the Class Settlement Order and Final Judgment or this Class Settlement Agreement, unless (z) if as of the date on which (x) or (y) is satisfied, any other action or proceeding instituted by a member of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class is pending that challenges or seeks relief at variance with the Class Settlement Order and Final Judgment or this Class Settlement Agreement, except for an action by an Opt Out that seeks only damages based on a Defendant’s conduct prior to the date of the Court’s entry of the Class Settlement Preliminary Approval Order, then ten business days after any such action or proceeding is dismissed or fully resolved through final judgment or otherwise and there is no possibility of any modification of that dismissal or resolution through any rehearing, appeal, or otherwise.

(xx) “Settlement Preliminary Approval Date” means the business day after all of the following conditions have been satisfied: (i) the Class Plaintiffs, Class Counsel, and the Defendants all have executed this Class Settlement Agreement, (ii) the Class Plaintiffs, Class Counsel, the Visa Defendants, and the MasterCard Defendants have established the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s); (iii) this Class Settlement Agreement has been approved by the requisite vote of the members of Visa U.S.A. Inc. entitled to vote thereon; and (iv) the Court has entered the Class Settlement Preliminary Approval Order without material modification from the form of the attached Appendix D hereto, including without any modification of the provisional certification for the purposes of settlement of the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class (from which exclusions are not permitted), and including without any modification of the releases and covenants not to sue provided by those settlement classes.

 

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(yy) “Taxes” means (i) any and all applicable taxes, duties, and similar charges imposed by a government authority (including any estimated taxes, interest, or penalties) arising in any jurisdiction, if any, (A) with respect to the income or gains earned by or in respect of the Escrow Account(s) including, without limitation, any taxes that may be imposed upon Defendants with respect to any income or gains earned by or in respect of an Escrow Account for any period while it is held by the Escrow Agent during which the Escrow Account does not qualify as a qualified settlement fund for federal or state income tax purposes, or (B) with respect to the income or gains earned by or in respect of any of the Escrow Account(s), or by way of withholding as required by applicable law on any distribution by the Escrow Agent(s) of any portion of the Escrow Account(s) to the Class Administrator, Authorized Cash Claimants, Authorized Interchange Claimants, or other persons entitled to such distributions pursuant to this Class Settlement Agreement, and (ii) any and all expenses, liabilities, and costs incurred in connection with the taxation of the Escrow Account(s) (including without limitation expenses of tax attorneys and accountants).

(zz) “Total Cash Payment Amount” means the amount specified in Paragraph 9 below, and does not include the Default Interchange Payments defined in Paragraph 1(w).

(aaa) “United States” means all the States, territories, and possessions of the United States, the District of Columbia, the Commonwealth of Puerto Rico, and any political subdivision of the foregoing.

(bbb) “Visa-Branded Card” means any Credit Card or Debit Card that bears or uses the name Visa, Plus, Interlink, or any other brand name or mark owned or licensed for use by a Visa Defendant, or that is issued under any such brand or mark.

(ccc) “Visa Defendants” means Visa U.S.A. Inc., Visa International Service Association, and Visa Inc., and each of their respective subsidiaries, successors, purchasers, and

 

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assigns (including an acquirer of all or substantially all of their respective assets, stock, or other ownership interests).

Settlement Classes

2. The Class Plaintiffs will seek, and the Defendants will not oppose, the Court’s certification of two settlement classes for settlement purposes only, defined as follows.

(a) A “Rule 23(b)(3) Settlement Class” under Federal Rules of Civil Procedure 23(a) and (b)(3), from which exclusions shall be permitted, consisting of all persons, businesses, and other entities that have accepted Visa-Branded Cards and/or MasterCard-Branded Cards in the United States at any time from January 1, 2004 to the Settlement Preliminary Approval Date, except that this Class does not include the named Defendants, their directors, officers, or members of their families, financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time from January 1, 2004 to the Settlement Preliminary Approval Date, or the United States government.

(b) A “Rule 23(b)(2) Settlement Class” under Federal Rules of Civil Procedure 23(a) and (b)(2), from which exclusions shall not be permitted, consisting of all persons, businesses, and other entities that as of the Settlement Preliminary Approval Date or in the future accept any Visa-Branded Cards and/or MasterCard-Branded Cards in the United States, except that this Class shall not include the named Defendants, their directors, officers, or members of their families, financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time since January 1, 2004, or do so in the future, or the United States government.

3. The Class Plaintiffs and the Defendants stipulate and agree that, in paragraph 108 of the Second Consolidated Amended Class Action Complaint, paragraph 258 of the First

 

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Amended Supplemental Class Action Complaint, and paragraph 223 of the Second Supplemental Class Action Complaint, the definitions of “Class I” are amended to be the same as the Rule 23(b)(3) Settlement Class, and the definitions of “Class II” are amended to be the same as the Rule 23(b)(2) Settlement Class, and that the Court’s orders preliminarily and finally approving this Settlement Agreement must so amend those Operative Class Complaints.

4. The Class Plaintiffs will seek, and the Defendants will not oppose, the Court’s appointment of the law firms of Robins, Kaplan, Miller & Ciresi L.L.P., Berger & Montague, P.C., and Robbins Geller Rudman & Dowd LLP as Class Counsel to represent the members of the Rule 23(b)(3) Settlement Class and the members of the Rule 23(b)(2) Settlement Class.

5. The Class Plaintiffs agree that they (a) will not seek to become Opt Outs or otherwise exclude themselves from the Rule 23(b)(3) Settlement Class, or in any way, by class definition or otherwise, seek to exclude themselves from the Rule 23(b)(2) Settlement Class, and (b) will not object to the Court’s preliminary or final approval of this Class Settlement Agreement. The Class Plaintiffs will seek, and on the basis of and in reliance on this commitment the Defendants will not oppose, the Court’s appointment of the Class Plaintiffs as the representative members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class.

Class Settlement Escrow Account(s)

6. Within seven business days after execution of this Class Settlement Agreement, the Class Counsel, the Visa Defendants, and the MasterCard Defendants shall establish the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s) pursuant to the terms of the escrow agreements provided in Appendices B and C hereto. Funds in those Escrow Account(s) shall be invested solely as provided in Appendices B and C hereto. The Class Plaintiffs and the Defendants agree that each Class Settlement Cash Escrow Account

 

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and each Class Settlement Interchange Escrow Account is intended to be and shall be treated as a Qualified Settlement Fund within the meaning of Treasury Regulation § 1.468B-1 and any analogous local, state, and/or foreign statute, law, regulation, or rule. No signature or approval from the Visa Defendants or the MasterCard Defendants shall be required for disbursement from any of the Escrow Account(s) commencing the day after ten business days after the Settlement Final Date.

7. All Taxes with respect to any sums in any Class Settlement Cash Escrow Account or any Class Settlement Interchange Escrow Account, the administrative costs of paying such Taxes, and any other costs of establishing, maintaining, or administering that Escrow Account shall be paid from that Escrow Account by the Escrow Agent(s).

8. No payments from the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Account(s), or any other use of those Escrow Account(s), shall be made without the prior approval of the Court (which may include approval of payments consistent with proposed budgets and expenses). Class Plaintiffs shall provide Defendants with prior notice of any applications to the Court for such approvals sought up to ten business days after the Settlement Final Date. In no event shall any Defendant, or any other Rule 23(b)(3) Settlement Class Released Party or Rule 23(b)(2) Settlement Class Released Party, have any obligation, responsibility, or liability arising from or relating to the administration, maintenance, preservation, investment, use, allocation, adjustment, distribution, disbursement, or disposition of any funds in the Class Settlement Escrow Account(s) or the Class Settlement Interchange Escrow Account(s).

Payments to the Class Settlement Escrow Account(s)

9. The Class Plaintiffs and the Defendants agree that the Total Cash Payment Amount shall be $6,050,000,000.

 

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10. Within ten business days after the Settlement Preliminary Approval Date, (a) the Visa Defendants shall pay by wire transfer into the Class Settlement Cash Escrow Account(s), from the litigation escrow account established under the Visa Defendants’ Retrospective Responsibility Plan, two-thirds of $6,050,000,000 (i.e., $4,033,333,333), and (b) the MasterCard Defendants and Bank Defendants shall pay by wire transfer into the Class Settlement Cash Escrow Account(s) a total of one-third of $6,050,000,000 (i.e., $2,016,666,667) in accordance with the agreement among themselves regarding their respective shares.

11. If this Class Settlement Agreement is not terminated prior to the commencement of the eight-month period described in Paragraphs 12 and 13 below, the Visa Defendants and the MasterCard Defendants each shall make a Default Interchange Payment by wire transfer into the Class Settlement Interchange Escrow Account(s). Those Default Interchange Payments shall be made within sixty days after the completion of the eight-month period described in Paragraphs 12 and 13 below in the event that this Class Settlement Agreement is not terminated during the eight-month period. If this Class Settlement Agreement terminates during the eight-month period described in Paragraphs 12 and 13 below, within sixty days of such termination, the Visa Defendants and the MasterCard Defendants each shall make their respective Default Interchange Payment based only on the portion of the eight-month period that preceded the date of termination. In the event of a termination of this Class Settlement Agreement after the commencement of the eight-month period described in Paragraphs 12 and 13 below, any Default Interchange Payments made to the Class Settlement Interchange Escrow Account(s) by the Visa Defendants and the MasterCard Defendants shall be distributed in a manner determined by the Court, if the parties do not enter into a new Class Settlement Agreement addressing such distribution, and in no event shall those Default Interchange Payments revert to the Visa Defendants or MasterCard Defendants or be distributed to Bank Defendants.

 

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12. The Default Interchange Payment of the Visa Defendants shall be calculated as follows. Within sixty days after the end of the Class Exclusion Period, the Visa Defendants shall reduce the default interchange rates in the manner provided in this Paragraph on United States acquired and issued Visa-Branded Credit Card transactions for a period of eight months (i.e., terminating on the same date of the month as the period commenced eight months earlier or, if no such date exists, the first day of the following month) unless this Class Settlement Agreement is earlier terminated. That reduction shall be effected by the Visa Defendants withholding or adjusting 10 basis points from the default interchange amounts that otherwise would be provided to issuers on transactions to which default interchange rates apply. The default interchange thus withheld or adjusted that is attributable to transactions of members of the Rule 23(b)(3) Settlement Class, exclusive of the transactions of the Individual Plaintiffs and Opt Outs, and prior to the date of any termination of this Class Settlement Agreement during the eight-month period described in this Paragraph, shall constitute the Default Interchange Payment of the Visa Defendants. The Visa Defendants shall identify and provide Class Counsel and the Class Administrator with data used to calculate, and sufficient to analyze and evaluate, that Default Interchange Payment. During the time period of the interchange reduction provided in this Paragraph, the Visa Defendants may not use their network fees to circumvent or evade the reduction in default interchange rates for Visa-Branded Credit Card transactions. For purposes of clarity, no modification need be made to any Visa-Branded Debit Card default interchange rates or deposits into issuer accounts, and the Visa Defendants shall not be required to modify their default interchange rates in any manner not provided in this Paragraph.

13. The Default Interchange Payment of the MasterCard Defendants shall be calculated as follows. Within sixty days after the end of the Class Exclusion Period, the MasterCard Defendants shall reduce the default interchange rates in the manner provided in this

 

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Paragraph on United States acquired and issued MasterCard-Branded Credit Card transactions for a period of eight months (i.e., terminating on the same day of the month as the period commenced eight months earlier, or if no such date exists, the first day of the following month) unless this Class Settlement Agreement is earlier terminated. That reduction shall be effected by the MasterCard Defendants withholding or adjusting 10 basis points from the default interchange amounts that otherwise would be provided to issuers on transactions to which default interchange rates apply. The default interchange thus withheld or adjusted that is attributable to transactions of members of the Rule 23(b)(3) Settlement Class, exclusive of the transactions of the Individual Plaintiffs and Opt Outs, and prior to the date of any termination of this Class Settlement Agreement during the eight-month period described in this Paragraph, shall constitute the Default Interchange Payment of the MasterCard Defendants. The MasterCard Defendants shall identify and provide Class Counsel and the Class Administrator with data used to calculate, and sufficient to analyze and evaluate, that Default Interchange Payment. During the time period of the interchange reduction provided in this Paragraph, the MasterCard Defendants may not use their network fees to circumvent or evade the reduction in default interchange rates for MasterCard-Branded Credit Card transactions. For purposes of clarity, no modification need be made to any MasterCard-Branded Debit Card default interchange rates or deposits into issuer accounts, and the MasterCard Defendants shall not be required to modify their default interchange rates in any manner not provided in this Paragraph.

14. Class Plaintiffs reserve their rights to seek appropriate relief from the Court in the event the payments described in Paragraphs 9-13 above are not timely made, including but not limited to relief consisting of immediate payment, interest, and penalties.

15. The payments described in Paragraphs 9-13 above shall exhaust and fully satisfy any and all payment obligations under this Class Settlement Agreement of the Defendants and

 

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any other Rule 23(b)(3) Settlement Class Released Parties or Rule 23(b)(2) Settlement Class Released Parties, and shall extinguish entirely any further obligation, responsibility, or liability to pay any notice expenses, attorneys’ fees, litigation costs, costs of administration, Taxes, settlement sums, or sums of any kind to the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Account(s), or to the Class Plaintiffs or other members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class (other than those who opt out of the Rule 23(b)(3) Settlement Class), or to any of their respective counsel, experts, advisors, agents, and representatives, all of whom shall look solely to the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s) for settlement and satisfaction of all claims released in this Class Settlement Agreement.

Payments from the Class Settlement Escrow Account(s)

16. Prior to the Settlement Final Approval Date, the Escrow Agent(s) may make payments from the Class Settlement Cash Escrow Account(s) only in the amounts approved by the Court, and only to pay for (a) the costs of establishing, maintaining, or administering the Class Settlement Cash Escrow Account(s) (including Taxes and the administrative costs of paying such Taxes), and (b) Settlement Administration Costs, including the costs of the Notice Plan and the exclusion procedures for Opt Outs as provided in Paragraphs 79-93 below, and additional costs for claims administration, in amounts consistent with the limitations of Paragraph 21(c) below.

17. Within ten business days after the Settlement Final Approval Date, the Escrow Agent(s) shall make the Class Exclusion Takedown Payments provided in Paragraphs 18-20 below, in the amounts stated in the Class Settlement Order and Final Judgment, regardless of any appeal or other challenge made to the Class Exclusion Takedown Payments or their amount. In the event of any appeal concerning the amount of the Class Exclusion Takedown Payments to

 

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the Visa Defendants or the MasterCard Defendants stated in the Class Settlement Order and Final Judgment, and which results in an order determining that those amounts should be modified, within ten business days after the Settlement Final Date the Visa Defendants and the MasterCard Defendants shall pay any amounts to be refunded by wire transfer to the Class Settlement Cash Escrow Account(s), and the Escrow Agents(s) shall pay any increased amounts due to the Visa Defendants or the MasterCard Defendants into an account that they shall designate.

18. Within ten business days after the Settlement Final Approval Date, the Escrow Agent(s) shall make a Class Exclusion Takedown Payment from the Class Settlement Cash Escrow Account(s) to an account that the Visa Defendants shall designate, to be calculated by (a) adding the total dollar sales paid with all Visa-Branded Cards in the United States, from January 1, 2004 up to the last day of the month in which the Court enters the Class Settlement Preliminary Approval Order, that are attributable to all persons, businesses, and other entities that become Opt Outs (other than the Individual Plaintiffs), (b) dividing that sum by the total dollar sales paid with all Visa-Branded Cards plus all MasterCard-Branded Cards in the United States, from January 1, 2004 up to the last day of the month in which the Court enters the Class Settlement Preliminary Approval Order, that are attributable to all members of the Rule 23(b)(3) Settlement Class plus all persons, business, and other entities that become Opt Outs (other than the Individual Plaintiffs), and then (c) multiplying that quotient by the Total Cash Payment Amount.

19. Within ten business days after the Settlement Final Approval Date, the Escrow Agent(s) shall make a Class Exclusion Takedown Payment from the Class Settlement Cash Escrow Account(s) to an account that the MasterCard Defendants shall designate, to be calculated by (a) adding the total dollar sales paid with all MasterCard-Branded Cards in the

 

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United States, from January 1, 2004 up to the last day of the month in which the Court enters the Class Settlement Preliminary Approval Order, that are attributable to all persons, businesses, and other entities that become Opt Outs (other than the Individual Plaintiffs), (b) dividing that sum by the total dollar sales paid with all Visa-Branded Cards plus all MasterCard-Branded Cards in the United States, from January 1, 2004 up to the last day of the month in which the Court enters the Class Settlement Preliminary Approval Order, that are attributable to all members of the Rule 23(b)(3) Settlement Class plus all persons, business, and other entities that become Opt Outs (other than the Individual Plaintiffs), and then (c) multiplying that quotient by the Total Cash Payment Amount.

20. In the event that the sum of the Class Exclusion Takedown Payments as calculated in Paragraphs 18 and 19 above would exceed twenty-five percent of the Total Cash Payment Amount (i.e., $1,512,500,000), and Defendants do not elect to terminate this Class Settlement Agreement pursuant to Paragraph 97 below, the payments under Paragraphs 18 and 19 above instead shall be calculated as provided in this Paragraph 20. The payment under Paragraph 18 to an account that the Visa Defendants shall designate shall be calculated by (w) dividing the sales described in Paragraph 18(a) by the sum of the sales described in Paragraphs 18(a) and 19(a), and then (x) multiplying that quotient by twenty-five percent of the Total Cash Payment Amount. The payment under Paragraph 19 to an account that the MasterCard Defendants shall designate shall be calculated by (y) dividing the sales described in Paragraph 19(a) by the sum of the sales described in Paragraphs 18(a) and 19(a), and then (z) multiplying that quotient by twenty-five percent of the Total Cash Payment Amount. Prior to such payments, the Visa Defendants and the MasterCard Defendants will disclose in writing to Class Counsel the amount of those two payments, which when added together must be equal to twenty-five percent of the Total Cash Payment Amount (i.e., $1,512,500,000).

 

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21. From the Settlement Final Approval Date to the date twenty business days after the Settlement Final Date, and subject to the Class Exclusion Takedown Payments provided in Paragraphs 17-20 above, the Escrow Agent(s) may make payments from the Class Settlement Cash Escrow Account(s) only in amounts approved by the Court for (a) the costs of maintaining or administering the Class Settlement Cash Escrow Account(s) (including Taxes and the administrative costs of paying such Taxes), (b) Expense Awards in an amount not to exceed a collective total of $30 million, and (c) further approved Settlement Administration Costs in amounts not to result in a collective total for all Settlement Administration Costs that would exceed $30 million from both the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s).

22. The Expense Awards of the Court paid from the Class Settlement Escrow Account(s) under Paragraph 21 above may be paid only to the law firms that are Class Counsel, which law firms may further disseminate such funds to other law firms representing plaintiffs in the Class Actions, but subject to the terms of this Paragraph. In the event that any Expense Awards of the Court paid from the Class Settlement Cash Escrow Account(s) under Paragraph 21 above are overturned or reduced on any appeal or otherwise, or in the event this Class Settlement Agreement is terminated by the date ten business days after the Settlement Final Date, each Class Counsel law firm that received such Expense Awards (whether those Awards were retained or disseminated to other law firms) shall, within ten business days of receiving notice thereof, refund all overturned Expense Awards, or the amount by which any Expense Awards were reduced, to those Class Settlement Cash Escrow Account(s), with interest thereon for the period from payment to refund at the same rate as earned on the funds deposited into the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s), the basis for which rate shall be disclosed to Defendants. Any Class Counsel law

 

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firm that receives Expense Awards pursuant to Paragraph 21(b) above agrees that it, and each member or shareholder of that law firm, is jointly and severally liable solely for the amount of the Expense Awards that the Class Counsel law firm received and that must be refunded (whether those Awards were retained or disseminated to other law firms), is subject to the continuing jurisdiction of the Court for the enforcement of the obligation to make such refunds, and is liable for any attorneys’ fees and costs that Defendants incur in recovering any such funds that must be refunded, and that the release provided to that law firm in Paragraphs 37 and 73 below shall not extend to any claims regarding such refunds.

23. Commencing the day after twenty business days after the Settlement Final Date, if this Class Settlement Agreement has not been terminated, and subject to the approval of the Court, the Class Settlement Cash Escrow Account(s) may be used for paying Attorney Fee Awards, Class Plaintiffs’ Awards, and Expense Awards not already paid pursuant to Paragraph 21 above, as approved by the Court.

24. Commencing the day after ten business days after the Settlement Final Date, and subject to the payments provided in Paragraphs 16-23 above, the Escrow Agent(s) may make payments from the Class Settlement Cash Escrow Account(s) in amounts approved by the Court based on applications filed with the Court and served on the Defendants, including for paying (a) the timely and proper claims of Authorized Cash Claimants pursuant to the Plan of Administration and Distribution approved by the Court, and (b) Settlement Administration Costs not already paid pursuant to Paragraph 21 above that are approved by the Court.

25. Until ten business days after the Settlement Final Date, the Escrow Agent(s) may make payments from the Class Settlement Interchange Escrow Account(s) only in the amounts approved by the Court, and only to pay for (a) the costs of establishing, maintaining, or administering the Class Settlement Interchange Escrow Account(s) (including Taxes and the

 

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administrative costs of paying such Taxes), and (b) Settlement Administration Costs in amounts not to result in a collective total for all Settlement Administration Costs that would exceed $30 million from both the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s).

26. Commencing the day after ten business days after the Settlement Final Date, the Escrow Agent(s) may make payments from the Class Settlement Interchange Accounts in amounts approved by the Court based on applications filed with the Court and served on Defendants, including for paying the timely and proper claims of members of Authorized Interchange Claimants pursuant to the Plan of Administration and Distribution approved by the Court.

27. Notwithstanding anything in Paragraphs 6-26 above, in the event that this Class Settlement Agreement is terminated as provided in Paragraphs 96-98 below, the Escrow Agent(s) shall promptly pay two-thirds of any sums in the Class Settlement Cash Escrow Account(s), less any Taxes due and Settlement Administration Costs approved by the Court and already paid or incurred, to an account that the Visa Defendants shall designate, and shall promptly pay one-third of any sums in the Class Settlement Cash Escrow Account(s), less any Taxes due and Settlement Administration Costs approved by the Court and paid or incurred, to an account that the MasterCard Defendants shall designate.

Consideration Provided to Members of the Rule 23(b)(3) Settlement Class

28. Members of the Rule 23(b)(3) Settlement Class shall receive money payments from the Net Cash Settlement Fund — i.e., the amounts deposited into the Class Settlement Cash Escrow Account(s) by virtue of the payment of the Total Cash Payment Amount, as reduced by the Class Exclusion Takedown Payments and other payments permitted under Paragraphs 16-24 above — pursuant to the claims process specified in the Plan of Administration and Distribution

 

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attached as Appendix I hereto, which Class Plaintiffs will propose to the Court in moving for preliminary approval of this Class Settlement Agreement, and as later or otherwise modified and ordered by the Court.

29. Members of the Rule 23(b)(3) Settlement Class that accepted Visa-Branded Credit Card transactions during the eight month or shorter period provided in Paragraph 12 above, and/or that accepted MasterCard-Branded Credit Card transactions during the eight month or shorter period provided in Paragraph 13 above, shall receive money payments from the Net Interchange Settlement Fund — i.e., the amounts deposited into the Class Settlement Interchange Escrow Account(s), as reduced by the payments permitted under Paragraphs 25-26 above — pursuant to the claims process specified in the Plan of Administration and Distribution attached as Appendix I hereto, which Class Plaintiffs will propose to the Court in moving for preliminary approval of this Class Settlement Agreement, and as later or otherwise modified and ordered by the Court.

30. Insofar as any sums remain in the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Account(s) after paying the timely and proper claims of the members of the Rule 23(b)(3) Settlement Class as provided in the preceding two Paragraphs (whether made in one or more distributions), any Taxes or administrative expenses incurred by the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Accounts, any Attorneys’ Fee Awards, any Expense Awards, any Class Plaintiffs’ Awards, and any additional costs and expenses incurred by Class Counsel for the benefit of the Rule 23(b)(3) Settlement Class and approved by the Court, Class Counsel shall make an application to the Court, with notice to Defendants, for such sums to be used to make cy pres payments for the benefit of members of the Rule 23(b)(3) Settlement Class. Defendants may comment upon and/or object to any such application.

 

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Release and Covenant Not to Sue of Rule 23(b)(3) Settlement Class

31. The “Rule 23(b)(3) Settlement Class Releasing Parties” are the Class Plaintiffs, each and every member of the Rule 23(b)(3) Settlement Class that does not become an Opt Out, and any of their respective past, present, or future: officers and directors; stockholders, agents, employees, legal representatives, partners, and associates (in their capacities as stockholders, agents, employees, legal representatives, partners, and associates of a member of the Rule 23(b)(3) Settlement Class only); and trustees, parents, subsidiaries, divisions, affiliates, heirs, executors, administrators, purchasers, predecessors, successors, and assigns — whether or not they object to this Class Settlement Agreement, and whether or not they make a claim for payment from the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Account(s), whether directly, representatively, derivatively, or in any other capacity.

32. The “Rule 23(b)(3) Settlement Class Released Parties” are all of the following:

(a) Visa U.S.A. Inc., Visa International Service Association, Visa Inc., Visa Asia Pacific Region, Visa Canada Association, Visa Central & Eastern Europe, Middle East & Africa Region, Visa Europe, Visa Europe Limited, Visa Latin America & Caribbean Region, and any other entity that now authorizes or licenses, or in the past has authorized or licensed, a financial institution to issue any Visa-Branded Cards or to acquire any Visa-Branded Card transactions.

(b) MasterCard International Incorporated, MasterCard Incorporated, and any other entity that now authorizes or licenses, or in the past has authorized or licensed, a financial institution to issue any MasterCard-Branded Cards or to acquire any MasterCard-Branded Card transactions.

 

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(c) Bank of America, N.A.; BA Merchant Services LLC (formerly known as National Processing, Inc.); Bank of America Corporation; MBNA America Bank, N.A., and FIA Card Services, N.A.

(d) Barclays Bank plc; Barclays Bank Delaware; and Barclays Financial Corp.

(e) Capital One Bank (USA), N.A.; Capital One F.S.B.; and Capital One Financial Corporation.

(f) Chase Bank USA, N.A.; Chase Manhattan Bank USA, N.A.; Chase Paymentech Solutions, LLC; JPMorgan Chase Bank, N.A.; JPMorgan Chase & Co.; Bank One Corporation; and Bank One Delaware, N.A.

(g) Citibank (South Dakota), N.A.; Citibank N.A.; Citigroup Inc.; and Citicorp.

(h) Fifth Third Bancorp.

(i) First National Bank of Omaha.

(j) HSBC Finance Corporation; HSBC Bank USA, N.A.; HSBC North America Holdings Inc.; HSBC Holdings plc; and HSBC Bank plc.

(k) National City Corporation and National City Bank of Kentucky.

(l) SunTrust Banks, Inc. and SunTrust Bank.

(m) Texas Independent Bancshares, Inc.

(n) Wachovia Bank, N.A. and Wachovia Corporation.

(o) Washington Mutual, Inc.; Washington Mutual Bank; Providian National Bank (also known as Washington Mutual Card Services, Inc.); and Providian Financial Corporation.

(p) Wells Fargo & Company and Wells Fargo Bank, N.A.

 

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(q) Each and every entity or person alleged to be a co-conspirator of any Defendant in any of the Operative Class Complaints or any of the Class Actions.

(r) Each of the past, present, or future member or customer financial institutions of Visa U.S.A. Inc., Visa International Service Association, Visa Inc., Visa Europe, Visa Europe Limited, MasterCard International Incorporated, or MasterCard Incorporated.

(s) For each of the entities or persons in Paragraphs 32(a)-(r) above, each of their respective past, present, and future, direct and indirect, parents (including holding companies), subsidiaries, affiliates, and associates (all as defined in SEC Rule 12b-2 promulgated pursuant to the Securities Exchange Act of 1934), or any other entity in which more than 50% of the equity interests are held.

(t) For each of the entities or persons in Paragraphs 32(a)-(s) above, each of their respective past, present, and future predecessors, successors, purchasers, and assigns (including acquirers of all or substantially all of the assets, stock, or other ownership interests of any of the Defendants to the extent a successor’s, purchaser’s, or acquirer’s liability is based on the Rule 23(b)(3) Settlement Class Released Parties as defined in Paragraphs 32(a)-(s) above).

(u) For each of the entities or persons in Paragraphs 32(a)-(t) above, each of their respective past, present, and future principals, trustees, partners, officers, directors, employees, agents, attorneys, legal or other representatives, trustees, heirs, executors, administrators, shareholders, advisors, predecessors, successors, purchasers, and assigns (including acquirers of all or substantially all of the assets, stock, or other ownership interests of each of the foregoing entities to the extent a successor’s, purchaser’s, or acquirer’s liability is based on the Rule 23(b)(3) Settlement Class Released Parties as defined in Paragraphs 32(a)-(t) above).

 

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33. This release applies solely to the Rule 23(b)(3) Settlement Class Releasing Parties. In addition to the effect of the Class Settlement Order and Final Judgment entered in accordance with this Class Settlement Agreement, including but not limited to any res judicata effect, the Rule 23(b)(3) Settlement Class Releasing Parties hereby expressly and irrevocably waive, and fully, finally, and forever settle, discharge, and release the Rule 23(b)(3) Settlement Class Released Parties from any and all manner of claims, demands, actions, suits, and causes of action, whether individual, class, representative, parens patriae, or otherwise in nature, for damages, interest, costs, expenses, attorneys’ fees, fines, civil or other penalties, or other payment of money, or for injunctive, declaratory, or other equitable relief, whenever incurred, whether directly, indirectly, derivatively, or otherwise, regardless of when such claims accrue, whether known or unknown, suspected or unsuspected, in law or in equity that any Rule 23(b)(3) Settlement Class Releasing Party ever had, now has, or hereafter can, shall, or may in the future have, arising out of or relating in any way to any conduct, acts, transactions, events, occurrences, statements, omissions, or failures to act of any Rule 23(b)(3) Settlement Class Released Party that are alleged or which could have been alleged from the beginning of time until the date of the Court’s entry of the Class Settlement Preliminary Approval Order in any of the Operative Class Complaints or Class Action complaints, or in any amendments to the Operative Class Complaints or Class Action complaints, including but not limited to any claims based on or relating to:

(a) any interchange rules, interchange fees, or interchange rates, or any other Rule of any Visa Defendant or MasterCard Defendant, or any agreement involving any Visa Defendant or any MasterCard Defendant and any other Rule 23(b)(3) Settlement Class Released Party, and/or any merchant arising out of or relating to interchange rules, interchange fees, or interchange rates, card issuance, or card acceptance with respect to any Visa-Branded Card

 

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transactions in the United States or any MasterCard-Branded Card transactions in the United States;

(b) any Merchant Fee of any Rule 23(b)(3) Settlement Released Party relating to any Visa-Branded Card transactions in the United States or any MasterCard-Branded Card transactions in the United States;

(c) any actual or alleged “no surcharge” rules, “honor all cards” rules, “no minimum purchase” rules, “no discounting” rules, “non-discrimination” rules, “anti-steering” rules, Rules that limit merchants in favoring or steering customers to use certain payment systems, “all outlets” rules, “no bypass” rules, or “no multi-issuer” rules, or any other actual or alleged Rule of any Rule 23(b)(3) Settlement Class Released Party relating to any Visa-Branded Cards or any MasterCard-Branded Cards, or a merchant’s point of sale practices relating to any Visa-Branded Cards or any MasterCard-Branded Cards;

(d) any actual or alleged agreement (i) between or among any Visa Defendant and any MasterCard Defendant, (ii) between or among any Visa Defendant or MasterCard Defendant and any other Rule 23(b)(3) Settlement Class Released Party or Parties, or (iii) between or among any Visa Defendant, MasterCard Defendant, or any other Rule 23(b)(3) Settlement Class Released Party or Parties relating to conduct or Rules of any Visa Defendant or any MasterCard Defendant;

(e) any reorganization, restructuring, initial or other public offering, or other corporate structuring of any Visa Defendant or MasterCard Defendant;

(f) any service of an employee or agent of any Rule 23(b)(3) Settlement Class Released Party on any board or committee of any Visa Defendant or MasterCard Defendant;

(g) the future effect in the United States of the continued imposition of or adherence to any Rule of any Visa Defendant or MasterCard Defendant in effect in the United

 

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States as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order, any Rule modified or to be modified pursuant to this Class Settlement Agreement, or any Rule that is substantially similar to any Rule in effect in the United States as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order or any Rule modified or to be modified pursuant to this Class Settlement Agreement;

(h) the future effect in the United States of any conduct of any Rule 23(b)(3) Settlement Class Released Party substantially similar to the conduct of any Rule 23(b)(3) Settlement Class Released Party related to or arising out of interchange rules, interchange fees, or interchange rates, any Rule of any Visa Defendant or MasterCard Defendant modified or to be modified pursuant to this Class Settlement Agreement, any other Rule of any Visa Defendant or any MasterCard Defendant in effect as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order, or any Rule substantially similar to any of the foregoing Rules;

(i) any conduct of this Action, including without limitation any settlement discussions relating to this Action, the negotiation of and agreement to this Class Settlement Agreement by the Defendants or any member or customer financial institution of the Visa Defendants or the MasterCard Defendants, or any terms or effect of this Class Settlement Agreement (other than claims to enforce this Class Settlement Agreement), including any changes in the Rule 23(b)(3) Settlement Class Released Parties’ Rules as a result of this Class Settlement Agreement;

and it is expressly agreed, for purposes of clarity, without expanding or limiting the foregoing, that any claims based on or relating to (a)-(i) above are claims that were or could have been alleged in this Action.

34. Each Rule 23(b)(3) Settlement Class Releasing Party further expressly and irrevocably waives, and fully, finally, and forever settles and releases, any and all defenses,

 

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rights, and benefits that the Rule 23(b)(3) Settlement Class Releasing Party may have or that may be derived from the provisions of applicable law which, absent such waiver, may limit the extent or effect of the release contained in the preceding Paragraphs 31-33. Without limiting the generality of the foregoing, each Rule 23(b)(3) Settlement Class Releasing Party expressly and irrevocably waives and releases any and all defenses, rights, and benefits that the Rule 23(b)(3) Settlement Class Releasing Party might otherwise have in relation to the release by virtue of the provisions of California Civil Code Section 1542 or similar laws of any other state or jurisdiction. SECTION 1542 PROVIDES: “CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE. A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.” In addition, although each Rule 23(b)(3) Settlement Class Releasing Party may hereafter discover facts other than, different from, or in addition to those that it or he or she knows or believes to be true with respect to any claims released in the preceding Paragraphs 31-33, each Rule 23(b)(3) Settlement Class Releasing Party hereby expressly waives, and fully, finally, and forever settles, discharges, and releases, any known or unknown, suspected or unsuspected, contingent or non-contingent claims within the scope of the preceding Paragraphs 31-33, whether or not concealed or hidden, and without regard to the subsequent discovery or existence of such other, different, or additional facts. Class Plaintiffs acknowledge, and the members of the Rule 23(b)(3) Settlement Class shall be deemed by operation of the Class Settlement Order and Final Judgment to have acknowledged, that the foregoing waiver was separately bargained for and is a key element of this Class Settlement Agreement.

 

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35. Each Rule 23(b)(3) Settlement Class Releasing Party covenants and agrees that it shall not, hereafter, seek to establish, or permit another to act for it in a representative capacity to seek to establish, liability against any of the Rule 23(b)(3) Settlement Class Released Parties based, in whole or in part, upon any conduct covered by any of the claims released in Paragraphs 31-34 above.

36. For avoidance of doubt, no other provision of this Class Settlement Agreement releases any claim of a Rule 23(b)(3) Settlement Class Releasing Party that is based on:

(a) breach of this Class Settlement Agreement;

(b) standard commercial disputes arising in the ordinary course of business under contracts or commercial relations regarding loans, lines of credit, or other related banking or credit relations, individual chargeback disputes, products liability, breach of warranty, misappropriation of cardholder data or invasion of privacy, compliance with technical specifications for a merchant’s acceptance of Credit Cards or Debit Cards, and any other dispute arising out of a breach of any contract between any of the Rule 23(b)(3) Settlement Class Releasing Parties and any of the Rule 23(b)(3) Settlement Class Released Parties; provided, however, that Paragraphs 31-35 above and not this Paragraph shall control in the event that any such claim challenges the legality of interchange rules, interchange rates, or interchange fees, or any other Rule fee, charge, or other conduct covered by any of the claims released in Paragraphs 31-35 above; or

(c) the claims alleged in the currently operative complaints against the current defendants in (i) NACS, et al. v. Board of Governors of the Federal Reserve System, No. 11-CV-02075-RJL (D.D.C.), and (ii) In re ATM Fee Antitrust Litigation, No. 04-CV-02676-CRB (N.D. Cal) (including claims that have been asserted to have been alleged in the Second Amended and Third Amended Complaints against Bank of America, N.A.).

 

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37. Each Rule 23(b)(3) Settlement Class Releasing Party further releases each of the Visa Defendants, MasterCard Defendants, and Bank Defendants and their counsel and experts in this Action from any claims relating to the defense of this Action, including the negotiation and terms of this Class Settlement Agreement, except for any claims relating to enforcement of this Class Settlement Agreement. Each Visa Defendant, MasterCard Defendant, and Bank Defendant releases the Class Plaintiffs, the other plaintiffs in the Class Actions, Class Counsel, Class Plaintiffs’ other counsel who have participated in any settlement conferences before the Court for a Class Plaintiff that executes this Class Settlement Agreement, and their respective experts in the Class Actions, from any claims relating to their institution or prosecution of the Class Actions, including the negotiation and terms of this Class Settlement Agreement, except for any claims relating to enforcement of this Class Settlement Agreement.

38. In the event that this Class Settlement Agreement is terminated pursuant to Paragraphs 96-98 below, or any condition for the Settlement Final Approval Date is not satisfied, the release and covenant not to sue provisions of Paragraphs 31-37 above shall be null and void and unenforceable.

Consideration Provided to Members of the Rule 23(b)(2) Settlement Class

39. Members of the Rule 23(b)(2) Settlement Class shall receive no money payments, but shall receive relief as set forth below.

Visa Rules Modifications

40. The Visa Defendants shall maintain their respective “no discounting” and “non-discrimination” rules as provided in, and for the time period provided in, the Final Judgment that the court entered on July 20, 2011 in United States v. American Express Co., et al., No. 10-CV-04496 (E.D.N.Y.) (NGG) (RER), a copy of which is attached as Appendix J, and shall maintain at no cost in the United States, consistent with the terms of the Final Judgment,

 

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the Visa Product Eligibility Service described in the Declaration of Judson Reed filed on June 14, 2011 in that action, subject to any subsequent modifications thereto in that action. In the event that the obligations imposed on the Visa Defendants in that Final Judgment are terminated in that action before July 20, 2021, those obligations shall thenceforth be imposed on the Visa Defendants under this Class Settlement Agreement in this Action but only until July 20, 2021.

41. Commencing sixty days after the Settlement Preliminary Approval Date, the Visa Defendants will permit a merchant to decline acceptance of all “Visa POS Debit Devices” or all “Other Visa Products,” as defined pursuant to Visa’s settlement agreement in the In re Visa Check/MasterMoney Antitrust Litigation, No. 96-CV-05238 (E.D.N.Y.) (JG) (JO), at all outlets that operate under the same trade name or banner in the United States, even if that merchant accepts all “Visa POS Debit Devices or all “Other Visa Products” at outlets that operate under a different trade name or banner within or outside of the United States. Nothing herein shall prevent the Visa Defendants from retaining or promulgating rules that require a merchant, (a) to the extent that the merchant accepts “Visa POS Debit Devices” at any of the merchant’s outlets operating under a given trade name or banner in the United States, to accept “Visa POS Debit Devices” at all outlets operating under that trade name or banner, or (b) to the extent that the merchant accepts “Other Visa Products” at any of the merchant’s outlets operating under a given trade name or banner in the United States, to accept “Other Visa Products” at all outlets operating under that trade name or banner. Nothing herein shall prohibit the Visa Defendants from (a) using volume-based pricing and pricing incentives, or (b) contracting with an individual merchant, including for more favorable pricing, based on its acceptance at all outlets in the United States; provided, however, that the Visa Defendants shall not require merchant

 

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acceptance at all outlets in connection with a volume-based incentive program made generally available to all merchants in the United States.

42. Within sixty days after the Settlement Preliminary Approval Date, the Visa Defendants shall modify their “no surcharge” rules to permit a merchant in the United States to surcharge Visa-Branded Credit Card Transactions at either (but not both) the “Brand Level” or the “Product Level,” as defined below in this Paragraph 42 and subject to the terms and conditions in this Paragraph 42.

(a) Brand Level Surcharging: A permitted Brand Level Surcharge is one in which:

 

  (i) A merchant adds the same surcharge to all Visa Credit Card Transactions, regardless of the card’s issuer or product type, after accounting for any discounts or rebates offered by the merchant on Visa Credit Card Transactions at the point of sale;

 

  (ii) The surcharge on each Visa Credit Card Transaction is no greater than the merchant’s Visa Surcharge Cap;

 

  (iii) The surcharge on each Visa Credit Card Transaction does not exceed the Maximum Surcharge Cap, if the Visa Defendants elect to set a Maximum Surcharge Cap and post on the Visa website the information set forth below in the first sentence of the definition of Maximum Surcharge Cap.

 

  (iv) If a merchant’s ability to surcharge any Competitive Credit Card Brand that the merchant accepts in a channel of commerce (either face-to-face or not face-to-face) is limited in any manner by that Competitive Credit Card Brand, other than by prohibiting a surcharge greater than the Competitive Credit Card Brand’s Cost of Acceptance, then the merchant may surcharge Visa Credit Card Transactions, consistent with the other terms of this Paragraph 42(a), only on either the same conditions on which the merchant would be allowed to surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, or on the terms on which the merchant actually does surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, after accounting for any discounts or rebates offered at the point of sale;

 

  (v) The requirements of Paragraph 42(a)(iv) do not apply to the extent that

 

  (A)

the Competitive Credit Card Cost of Acceptance to the merchant is less than the Visa Credit Card Cost of Acceptance to that merchant and the Competitive Credit Card Brand does not prohibit or effectively prohibit

 

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  surcharging Credit Cards (a rule, by-law, regulation or contract provision that provides in words or substance for no discrimination or equal treatment applicable to Credit Cards only is not deemed to “prohibit or effectively prohibit surcharging Credit Cards” under this provision); or

 

  (B) the Competitive Credit Card Brand prohibits or effectively prohibits surcharging Credit Cards and the merchant actually surcharges the Competitive Credit Card Brand in an amount at least equal to the lesser of (I) the Competitive Credit Card Brand Cost of Acceptance or (II) the amount of surcharge imposed on the Visa Credit Card Transaction to be surcharged; or

 

  (C) there is an agreement between the merchant and the Competitive Credit Card Brand in which the merchant waives or in any other way restrains or limits its ability to surcharge transactions on that Competitive Credit Card Brand, as long as: (I) the agreement is for a fixed duration, is not subject to an evergreen clause, and is individually negotiated with the merchant and is not a standard agreement or part of a standard agreement generally offered by the Competitive Credit Card Brand to multiple merchants, (II) the merchant’s acceptance of the Competitive Credit Card Brand as payment for goods and services is unrelated to and not conditioned upon the merchant’s entry into such an agreement, (III) any such agreement or waiver is supported by Independent Consideration, and (IV) the agreement expressly specifies a price under which the merchant may accept transactions on the Competitive Credit Card Brand and surcharge those transactions up to the merchant’s Merchant Discount Rate for the Competitive Credit Card Brand, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

  (D) For avoidance of doubt, for as long as Visa or MasterCard complies with the provisions of this Paragraph 42 or Paragraph 55, respectively, or any other Competitive Credit Card Brand has rules that are consistent with and no more restrictive than the provisions of this Paragraph 42 and Paragraph 55, each shall be deemed not to limit surcharging for purposes of this Paragraph.

 

  (vi) The merchant does not engage in surcharging at the product level as described in Paragraph 42(b) below; and

 

  (vii) The merchant complies with the merchant surcharging disclosure requirements set forth in Paragraph 42(c) below.

As used in this Paragraph 42(a):

 

   

“After accounting for any discounts or rebates offered by the merchant at the point of sale” means that the amount of the surcharge for a Visa Credit Card or a Competitive Credit Card Brand is to include the amount of any discount or rebate

 

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that is applied to that card or brand at the point of sale but which is not equally applied to all Visa Credit Card Transactions.

 

   

“Competitive Credit Card Brand” includes any brand of Credit Card or electronic credit payment form of a nationally accepted payment network other than Visa, specifically including without limitation MasterCard, American Express, Discover, and PayPal.

 

   

“Competitive Credit Card Brand Cost of Acceptance” is the merchant’s average Merchant Discount Rate applicable to transactions on a Competitive Credit Card Brand at the merchant for the preceding one or twelve months, at the merchant’s option.

 

   

“Independent Consideration” means material value a merchant receives specifically in exchange for the merchant’s agreement to waive or otherwise restrict its right to surcharge transactions on a Competitive Credit Card Brand, including, e.g., a material reduction in the Competitive Credit Card Brand’s standard acceptance cost applicable to the merchant (i.e., the cost at which transactions on Competitive Credit Card Brand’s cards are surcharged absent such an agreement).

 

   

The “Maximum Surcharge Cap” shall be no less than the product of 1.8 times the sum of the system-wide average effective U.S. domestic Visa Credit Card interchange rate plus average network fees (defined to include network set fees to acquirers or merchants associated with the processing of a transaction or with the acceptance of the network’s brand) as of the Preliminary Approval Date or as subsequently adjusted in accordance with this bullet. To facilitate the determination of the Maximum Surcharge Cap, within 10 business days of the Settlement Preliminary Approval Date, the Visa Defendants shall provide Class Counsel with the system-wide average effective U.S. domestic Visa Credit Card interchange rate plus average network fees (calculated based upon the preceding 12 month period) and will publish that amount on Visa’s website in a manner that is readily visible to merchants. The Visa Defendants shall adjust the Maximum Surcharge Cap in accordance with this bullet at least annually, and may adjust the Maximum Surcharge Cap in accordance with this bullet no more than two times per year.

 

   

“Merchant Discount Rate” is the fee, expressed as a percentage of the total transaction amount, that a merchant pays to its acquirer or processor for transacting on a Credit Card brand. For purposes of Paragraph 42(a), Merchant Discount Rate shall include (x) the interchange rate, network set fees associated with the processing of a transaction, network set fees associated with the acceptance of the network’s brand, and the acquirer set processing fees associated with the processing of a transaction, irrespective of whether such fees and costs are paid via the merchant discount or by check, withholding, offset, or otherwise; and (y) any other services for which the acquiring bank is paid via the mechanism of the per transaction merchant discount fee. Other than the fees listed in subpart

 

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(x) of the preceding sentence, the Merchant Discount Rate excludes any fees (such as the cost of rental of point-of-sale terminal equipment, for example) that are invoiced separately or not paid via the mechanism of the per transaction merchant discount fee.

 

   

“Visa Credit Card” is any Credit Card that bears or uses the name Visa or is branded or licensed by Visa.

 

   

“Visa Credit Card Cost of Acceptance” is the average effective interchange rate plus the average of all fees imposed by the network upon acquirers or merchants, expressed as a percentage of the transaction amount, applicable to Visa Credit Card Transactions at the merchant for the preceding one or twelve months, at the merchant’s option. If a merchant cannot determine its Visa Credit Card Cost of Acceptance, then the Merchant may use the Visa Credit Card Cost of Acceptance for the merchant’s merchant category as published no less than two times each year on Visa’s website.

 

   

“Visa Credit Card Transaction” is a transaction in which a Visa Credit Card is presented for payment and the transaction is subject to Visa’s Operating Regulations.

 

   

“Visa Surcharge Cap” is the average Merchant Discount Rate applicable to Visa Credit Card Transactions at the merchant for the preceding one or twelve months, at the merchant’s option.

(b) Product Level Surcharging: A permitted Product Level Surcharge is one in which:

 

  (i) A merchant adds the same surcharge to all Visa Credit Card Transactions of the same product type (e.g., Visa Classic Card, Visa Traditional Rewards Card, Visa Signature Card), regardless of the card’s issuer, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

  (ii) The surcharge on each Visa Credit Card Transaction is no greater than the merchant’s Visa Credit Surcharge Cap for that product type minus the Debit Card Cost of Acceptance;

 

  (iii) The surcharge on each Visa Credit Card Transaction does not exceed the Maximum Surcharge Cap, if the Visa Defendants elect to set a Maximum Surcharge Cap and post on the Visa website the information set forth below in the first sentence of the definition of Maximum Surcharge Cap;

 

  (iv)

If a merchant’s ability to surcharge any Competitive Credit Card Brand that the merchant accepts in a channel of commerce (either face-to-face or not face-to-face) is limited in any manner by that Competitive Credit Card Brand, other than by prohibiting a surcharge greater than the Competitive Credit Card Brand’s Cost of Acceptance, then the merchant may surcharge Visa Credit Card Transactions, consistent with the other terms of this Paragraph 42(b),

 

44


  only on either the same conditions on which the merchant would be allowed to surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, or on the terms on which the merchant actually does surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, after accounting for any discounts or rebates offered at the point of sale;

 

  (v) The requirements of Paragraph 42(b)(iv) do not apply to the extent that

 

  (A) the Competitive Credit Card Product Cost of Acceptance to the merchant is less than the Visa Credit Card Product Cost of Acceptance to that merchant and the Competitive Credit Card Brand does not prohibit or effectively prohibit surcharging Credit Cards (a rule, by-law, regulation or contract provision that provides in words or substance for no discrimination or equal treatment applicable to Credit Cards only is not deemed to “prohibit or effectively prohibit surcharging Credit Cards” under this provision); or

 

  (B) the Competitive Credit Card Brand prohibits or effectively prohibits surcharging Credit Cards and the merchant actually surcharges the Competitive Credit Card Brand in an amount at least equal to the lesser of (I) the Competitive Credit Card Brand Cost of Acceptance or (II) the amount of surcharge imposed on the Visa Credit Card Transaction to be surcharged; or

 

  (C) there is an agreement between the merchant and the Competitive Credit Card Brand in which the merchant waives or in any other way restrains or limits its ability to surcharge transactions on that Competitive Credit Card Brand, as long as: (I) the agreement is for a fixed duration, is not subject to an evergreen clause, and is individually negotiated with the merchant and is not a standard agreement or part of a standard agreement generally offered by the Competitive Credit Card Brand to multiple merchants, (II) the merchant’s acceptance of the Competitive Credit Card Brand as payment for goods and services is unrelated to and not conditioned upon the merchant’s entry into such an agreement, (III) any such agreement or waiver is supported by Independent Consideration, and (IV) the agreement expressly specifies a price under which the merchant may accept transactions on the Competitive Credit Card Brand and surcharge those transactions up to the merchant’s Merchant Discount Rate for the Competitive Credit Card Brand, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

  (D) For avoidance of doubt, for as long as Visa or MasterCard complies with the provisions of this Paragraph 42 or Paragraph 55, respectively, or any other Competitive Credit Card Brand has rules that are consistent with and no more restrictive than the provisions of this Paragraph 42 and Paragraph 55, each shall be deemed not to limit surcharging for purposes of this Paragraph;

 

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  (vi) The merchant does not engage in surcharging at the brand level as described in Paragraph 42(a) above; and

 

  (vii) The merchant complies with the merchant surcharging disclosure requirements set forth in Paragraph 42(c) below.

As used in this Paragraph 42(b):

 

   

“After accounting for any discounts or rebates offered by the merchant at the point of sale” means that the amount of the surcharge for Visa Credit Cards of the same product type or a Competitive Credit Card Product is to include the amount of any discount or rebate that is applied to that card or product at the point of sale but which is not equally applied to all Visa Credit Card Transactions of the same product type.

 

   

“Competitive Credit Card Product” includes any product within a brand of Credit Card or electronic credit payment form of a nationally accepted payment network other than Visa, specifically including without limitation MasterCard, American Express, Discover, and PayPal.

 

   

“Competitive Credit Card Product Cost of Acceptance” is the merchant’s average effective Merchant Discount Rate applicable to transactions on the Competitive Credit Card Product at the merchant for the preceding one or twelve months at the merchant’s option.

 

   

“Debit Card Cost of Acceptance” is the amount of the cap for debit transactions established by the Board of Governors of the Federal Reserve System pursuant to 15 U.S.C. § 1693o-2 and its implementing regulations or, if the Board of Governors discontinues establishing a cap for debit transactions, the merchant’s average effective Merchant Discount Rate for all PIN-based debit transactions for the preceding twelve months.

 

   

“Independent Consideration” means material value a merchant receives specifically in exchange for the merchant’s agreement to waive or otherwise restrict its right to surcharge transactions on a Competitive Credit Card Brand, including, e.g., a material reduction in the Competitive Credit Card Brand’s standard acceptance cost applicable to the merchant (i.e., the cost at which transactions on Competitive Credit Card Brand’s cards are surcharged absent such an agreement).

 

   

The “Maximum Surcharge Cap” shall be no less than the product of 1.8 times the sum of the system-wide average effective U.S. domestic Visa Credit Card interchange rate plus average network fees (defined to include network set fees to acquirers or merchants associated with the processing of a transaction or with the acceptance of the network’s brand) as of the Preliminary Approval Date or as subsequently adjusted in accordance with this bullet. To facilitate the determination of the Maximum Surcharge Cap, within 10 business days of the Settlement Preliminary Approval Date, the Visa Defendants shall provide Class

 

46


 

Counsel with the system-wide average effective U.S. domestic Visa Credit Card interchange rate plus average network fees (calculated based upon the preceding 12 month period) and will publish that amount on Visa’s website in a manner that is readily visible to merchants. The Visa Defendants agree shall adjust the Maximum Surcharge Cap in accordance with this bullet at least annually, and may adjust the Maximum Surcharge Cap in accordance with this bullet no more than two times per year.

 

   

“Merchant Discount Rate” is the fee, expressed as a percentage of the total transaction amount, that a merchant pays to its acquirer or processor for transacting on a Credit Card brand. For purposes of Paragraph 42(a), Merchant Discount Rate includes (x) the interchange rate, network set fees associated with the processing of a transaction, network set fees associated with the acceptance of the network’s brand, and the acquirer set processing fees associated with the processing of a transaction, irrespective of whether such fees and costs are paid via the merchant discount or by check, withholding, offset, or otherwise; and (y) any other services for which the acquiring bank is paid via the mechanism of the per transaction merchant discount fee. Other than the fees listed in subpart (x) of the preceding sentence, the Merchant Discount Rate excludes any fees (such as the cost of rental of point-of-sale terminal equipment, for example) that are invoiced separately or not paid via the mechanism of the per transaction merchant discount fee.

 

   

“Visa Credit Card” is any Credit Card that bears or uses the name Visa or is branded or licensed by Visa.

 

   

“Visa Credit Card Product Cost of Acceptance” is the average effective interchange rate plus the average of all fees imposed by the network upon acquirers or merchants, expressed as a percentage of the transaction amount, applicable to Visa Credit Card Transactions of a product type at the merchant for the preceding one or twelve months, at the merchant’s option. If a merchant cannot determine its Visa Credit Card Product Cost of Acceptance, then the Merchant may use the Visa Credit Card Product Cost of Acceptance for the merchant’s merchant category as published no less than two times each year on Visa’s website.

 

   

“Visa Credit Card Transaction” is a transaction in which a Visa Credit Card is presented for payment and the transaction is subject to Visa’s Operating Regulations.

 

   

“Visa Credit Surcharge Cap” for a product type is the average effective Merchant Discount Rate applicable to Visa Credit Card Transactions of that product type at the merchant for the preceding twelve months. At any given point in time, the actual Merchant Discount Rate paid in the time period covered by the merchant’s most recent statement relating to Visa Credit Card Transactions may be deemed a proxy for the Visa Credit Card Cost of Acceptance.

 

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(c) Merchant Surcharging Disclosure Requirements: A merchant’s ability to apply either a Brand Level or Product Level Surcharge is conditioned on the merchant’s agreement to abide by the following disclosure requirements. A merchant must:

 

  (i) Provide Visa and the merchant’s acquirer with no less than thirty days’ advance written notice that the merchant intends to impose surcharges, which shall identify whether the merchant intends to impose surcharges at the brand level or the product level. Any such notice shall be treated confidentially by the Visa Defendants and the merchant’s acquirer.

 

  (ii) Provide clear disclosure to the merchant’s customers at the point of store entry, or in an online environment on the first page that references Credit Card brands, that the merchant imposes a surcharge that is not greater than the applicable Merchant Discount Rate for Visa Credit Card Transactions at the merchant.

 

  (iii) Provide clear disclosure to the merchant’s customers of the merchant’s surcharging practices, at the point of interaction or sale with the customer, in a manner that does not disparage the brand, network, issuing bank, or the payment card product being used. By way of illustration and without limitation, disparagement does not include a merchant’s statement in words or substance that the merchant prefers or requests that a cardholder pay with a Credit Card or Debit Card that has a lower cost of acceptance to the merchant than the payment card presented for payment by the cardholder. The information on the merchant’s surcharging practices at the point of interaction must include (A) the amount of any surcharge that the merchant imposes, (B) a statement that the surcharge is being imposed by the merchant, and (C) a statement that the surcharge that the merchant imposes is not greater than the applicable Merchant Discount Rate for Visa Credit Card Transactions at the merchant.

 

  (iv) Provide clear disclosure of the dollar amount of the surcharge on the transaction receipt provided by the merchant to the customers.

(d) For the avoidance of doubt, nothing in this Class Settlement Agreement, including Paragraph 42, shall preclude the Visa Defendants from maintaining their prohibition of surcharging at the issuer level, i.e., adding surcharges that are not the same, after accounting for any discounts or rebates offered by a merchant at the point of sale, for all Visa Credit Cards or all Visa Credit Cards of a given product type, regardless of the issuing financial institution; and it is expressly agreed for the purpose of clarity that any claim relating to the past, continued, or future

 

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prohibition of such surcharging is within the scope of the Releases and Covenants Not to Sue set forth in Paragraphs 31-38 and 66-74.

(e) The Visa Defendants shall modify any other rules as necessary to ensure that the changes set forth in Paragraph 42(a) above are also applicable to merchants located in all United States territories and possessions, and the Commonwealth of Puerto Rico.

(f) Nothing in this Class Settlement Agreement shall prevent the Visa Defendants from contracting with merchants not to surcharge Visa-Branded Credit Cards or any Product type of Visa-Branded Credit Card as long as (i) the agreement is for a fixed duration, (ii) is not subject to an evergreen clause, (iii) is individually negotiated with the merchant or merchants organized in accordance with the provisions of Paragraph 43 below and is not a standard agreement or part of a standard agreement generally by the Visa Defendants, and (iv) any such agreement or waiver is supported by Independent Consideration; provided, however, that nothing in this Class Settlement Agreement shall affect any right of the Visa Defendants to limit or decline acceptance of Visa by a payment aggregator or payment services provider with a proprietary acceptance mark that surcharges or discriminates against Visa.

(g) In the event that Visa debit card transactions are no longer subject to the rate cap established by Board of Governors of the Federal Reserve System pursuant to 15 U.S.C. § 1693o-2 and its implementing regulations or any other regulated rate cap that may be subsequently implemented, the Visa Defendants will further modify the Visa rules to permit merchants to surcharge Visa debit card transactions in a manner equivalent to that permitted for Visa Credit Card transactions pursuant to Paragraph 42(a) above.

43. Within sixty days after the Settlement Preliminary Approval Date, the Visa Defendants shall modify their rules, by-laws, or regulations to the extent necessary to eliminate any restrictions therein on merchants’ rights to properly organize bona fide buying groups that

 

49


comply with the requirements of the DOJ Guidelines on Competitor Collaboration, the DOJ and FTC’s Statements of Antitrust Enforcement Policy in Health Care, and other applicable legal standards, to negotiate with Visa on behalf of members of the buying group. With respect to any proposals that Visa believes provides reasonable commercial benefits to the parties, Visa will negotiate with such buying groups in an effort to reach a commercially reasonable agreement, and Visa agrees to exercise its discretion and business judgment in good faith: (a) in determining whether a proposal sets forth commercially reasonable benefits to the parties; (b) in negotiations related to such proposals; and (c) in making its determination whether to accept or reject a proposal. In the event that any dispute arises with respect to this provision, the parties will be subject to the jurisdiction of, and the dispute shall be resolved by, the Court presiding over this Action, as part of the continuing jurisdiction of the Court over this Settlement and the Rule 23(b)(2) Settlement Class. In the event of such dispute, the party raising the dispute shall be limited to seeking declaratory relief, and to no other form of relief. The declaratory relief available as to any such dispute shall be limited to deciding whether (y) the putative buying group is a properly organized bona fide buying group that complies with the requirements of this Paragraph, and/or (z) whether Visa negotiated in good faith with the putative buying group. The parties, including all members of the Rule 23(b)(2) Settlement Class, waive all rights to appeal from any such determinations. Upon resolution of the dispute by the Court, the losing party shall be responsible for all attorneys’ fees and expenses of the prevailing party unless the Court determines that the circumstances make such an award unjust.

44. In the event that the obligations imposed on the Visa Defendants under 15 U.S.C. § 1693o-2(b)(3)(A)(i) not to prohibit merchants from setting a minimum dollar value for acceptance of credit cards that does not differentiate between issuers or payment card networks and that does not exceed $10.00 are terminated before July 20, 2021, those obligations shall

 

50


thenceforth be imposed on the Visa Defendants under this Class Settlement Agreement but only until July 20, 2021.

45. The rules requirements of Paragraphs 40-44 above shall remain in effect until July 20, 2021. The rules requirements of Paragraphs 40-44 above shall expire on July 20, 2021.

46. The Visa Defendants retain the right, but are in no way obligated, to further modify their by-laws, rules, operating regulations, practices, policies or procedures addressed in Paragraphs 40-45 in a manner that is more permissive of a merchant’s ability to engage in the point of sale practices described therein; provided, however, that it is expressly agreed for the purpose of clarity that any claim relating to a lack of such further modification of the by-laws, rules, operating regulations, practices, policies, or procedures addressed in Paragraphs 40-45 is within the scope of the Releases and Covenants Not to Sue set forth in Paragraphs 31-38 and 66-74.

47. The Visa Defendants shall not be required to modify their by-laws, rules, operating regulations, practices, policies, or procedures in any manner other than as provided in Paragraphs 40-45 above. From the date of execution of this Class Settlement Agreement to the Settlement Preliminary Approval Date, the Visa Defendants shall provide Class Counsel with advance notice of any material changes to their by-laws, rules, operating regulations, practices, policies, or procedures that pertain to Paragraphs 40-45 above and Paragraph 48 below. If Class Counsel believe that any of those material changes would result in a breach of this Class Settlement Agreement, they may seek relief from the Court after meeting and conferring with the Visa Defendants.

48. Any Visa by-laws, rules, operating regulations, practices, policies, or procedures amended pursuant to Paragraphs 40-45 above shall be enforced pursuant to Visa’s existing compliance rules and standards, including specifically Visa International Operating Regulations

 

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Core Principles 2.3 and 6.4. In the event that Visa takes action against a merchant’s acquirer or the merchant for the merchant’s failure to comply with the provisions of Paragraph 42 above, Visa shall provide notice of Visa’s action to Class Counsel or their designee.

49. No later than thirty days after the Settlement Preliminary Approval Date, and before any modifications of the Visa Defendants’ operating regulations necessary to effect Paragraphs 41-43 above become effective, the Visa Defendants shall (a) post on the Visa website a written notification that describes those modifications, (b) provide that written notification to all Visa issuers and acquirers in the United States, and (c) and direct Visa acquirers in the United States to provide that written notification to all merchants with whom they have acquiring relationships. The Visa Defendants agree to provide Class Counsel with an opportunity to offer comments on the language of that written notification.

50. Nothing in the foregoing changes to the Visa Defendants’ rules, by-laws, and/or operating regulations described in Paragraphs 40-45 above shall affect any obligation of any member of the Rule 23(b)(2) Settlement Class to comply with all applicable state or federal laws, including but not limited to state laws regarding surcharging of credit or debit card transactions, and federal and state laws regarding deceptive or misleading disclosures.

51. Nothing in this Class Settlement Agreement shall limit the ability of any Visa Defendant to set interchange rates, whether default rates or rates applicable (either by rule or negotiated agreement) to individual merchants, groups of merchants, or merchant trade associations.

52. Nothing in this Class Settlement Agreement shall impose any limitation upon any other conduct of any Rule 23(b)(2) Settlement Class Released Defendant not expressly modified by the terms hereof.

 

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MasterCard Rules Modifications

53. The MasterCard Defendants shall maintain their respective “no discounting” and “non-discrimination” rules as provided in, and for the time period provided in, the Final Judgment that the court entered on July 20, 2011 in United States v. American Express Co., et al., No. 10-CV-04496 (E.D.N.Y.) (NGG) (RER), a copy of which is attached as Appendix J, and shall maintain at no cost in the United States, consistent with the terms of the Final Judgment, the MasterCard Product Validation Service (also known as “Product Inquiry”) described in the Declaration of Brian Tomchek filed on June 14, 2011 in that action, subject to any subsequent modifications thereto in that action. In the event that the obligations imposed on the MasterCard Defendants in that Final Judgment are terminated in that action before July 20, 2021, those obligations shall thenceforth be imposed on the MasterCard Defendants under this Class Settlement Agreement in this Action but only until July 20, 2021.

54. Commencing sixty days after the Settlement Preliminary Approval Date, the MasterCard Defendants will permit a merchant to decline acceptance of all “MasterCard POS Debit Devices” or all “Other MasterCard Products,” as defined pursuant to MasterCard’s settlement agreement in the In re Visa Check/MasterMoney Antitrust Litigation, No. 96-CV-05238 (E.D.N.Y.) (JG) (JO), at all outlets that operate under the same trade name or banner in the United States, even if that merchant accepts all “MasterCard POS Debit Devices” or all “Other MasterCard Products” at outlets that operate under a different trade name or banner within or outside of the United States. Nothing herein shall prevent the MasterCard Defendants from retaining or promulgating rules that require a merchant, (a) to the extent that the merchant accepts “MasterCard POS Debit Devices” at any of the merchant’s outlets operating under a given trade name or banner in the United States, to accept “MasterCard POS Debit Devices” at all outlets operating under that trade name or banner, or (b) to the extent that the merchant

 

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accepts “Other MasterCard Products” at any of the merchant’s outlets operating under a given trade name or banner in the United States, to accept “Other MasterCard Products” at all outlets operating under that trade name or banner. Nothing herein shall prohibit the MasterCard Defendants from (a) using volume-based pricing and pricing incentives, or (b) contracting with an individual merchant, including for more favorable pricing based on its acceptance at all outlets in the United States; provided, however, that the MasterCard Defendants shall not require merchant acceptance at all outlets in connection with a volume-based incentive program made generally available to all merchants in the United States.

55. Within sixty days after the Settlement Preliminary Approval Date, the MasterCard Defendants shall modify their “no surcharge” rules to permit a merchant in the United States to surcharge MasterCard-Branded Credit Card Transactions at either (but not both) the “Brand Level” or the “Product Level,” as defined below in this Paragraph 55 and subject to the terms and conditions in this Paragraph 55.

(a) Brand Level Surcharging: A permitted Brand Level Surcharge is one in which:

 

  (i) A merchant adds the same surcharge to all MasterCard Credit Card Transactions, regardless of the card’s issuer or product type, after accounting for any discounts or rebates offered by the merchant on MasterCard Credit Card Transactions at the point of sale;

 

  (ii) The surcharge on each MasterCard Credit Card Transaction is no greater than the merchant’s MasterCard Surcharge Cap;

 

  (iii) The surcharge on each MasterCard Credit Card Transaction does not exceed the Maximum Surcharge Cap, if the MasterCard Defendants elect to set a Maximum Surcharge Cap and post on the MasterCard website the information set forth below in the first sentence of the definition of Maximum Surcharge Cap.

 

  (iv)

If a merchant’s ability to surcharge any Competitive Credit Card Brand that the merchant accepts in a channel of commerce (either face-to-face or not face-to-face) is limited in any manner by that Competitive Credit Card Brand, other than by prohibiting a surcharge greater than the Competitive Credit Card Brand’s Cost of Acceptance, then the merchant may surcharge MasterCard

 

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  Credit Card Transactions, consistent with the other terms of this Paragraph 55(a), only on either the same conditions on which the merchant would be allowed to surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, or on the terms on which the merchant actually does surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, after accounting for any discounts or rebates offered at the point of sale;

 

  (v) The requirements of Paragraph 55(a)(iv) do not apply to the extent that

 

  (A) the Competitive Credit Card Cost of Acceptance to the merchant is less than the MasterCard Credit Card Cost of Acceptance to that merchant and the Competitive Credit Card Brand does not prohibit or effectively prohibit surcharging Credit Cards (a rule, by-law, regulation or contract provision that provides in words or substance for no discrimination or equal treatment applicable to Credit Cards only is not deemed to “prohibit or effectively prohibit surcharging Credit Cards” under this provision); or

 

  (B) the Competitive Credit Card Brand prohibits or effectively prohibits surcharging Credit Cards and the merchant actually surcharges the Competitive Credit Card Brand in an amount at least equal to the lesser of (I) the Competitive Credit Card Brand Cost of Acceptance or (II) the amount of surcharge imposed on the MasterCard Credit Card Transaction to be surcharged; or

 

  (C) there is an agreement between the merchant and the Competitive Credit Card Brand in which the merchant waives or in any other way restrains or limits its ability to surcharge transactions on that Competitive Credit Card Brand, as long as: (I) the agreement is for a fixed duration, is not subject to an evergreen clause, and is individually negotiated with the merchant and is not a standard agreement or part of a standard agreement generally offered by the Competitive Credit Card Brand to multiple merchants, (II) the merchant’s acceptance of the Competitive Credit Card Brand as payment for goods and services is unrelated to and not conditioned upon the merchant’s entry into such an agreement, (III) any such agreement or waiver is supported by Independent Consideration, and (IV) the agreement expressly specifies a price under which the merchant may accept transactions on the Competitive Credit Card Brand and surcharge those transactions up to the merchant’s Merchant Discount Rate for the Competitive Credit Card Brand, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

  (D)

For avoidance of doubt, for as long as Visa or MasterCard complies with the provisions of this Paragraph 42 or Paragraph 55, respectively, or any other Competitive Credit Card Brand has rules that are consistent with and no more restrictive than the provisions of this Paragraph 42 and

 

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  Paragraph 55, each shall be deemed not to limit surcharging for purposes of this Paragraph.

 

  (vi) The merchant does not engage in surcharging at the product level as described in Paragraph 55(b) below; and

 

  (vii) The merchant complies with the merchant surcharging disclosure requirements set forth in Paragraph 55(c) below.

As used in this Paragraph 55(a):

 

   

“After accounting for any discounts or rebates offered by the merchant at the point of sale” means that the amount of the surcharge for a MasterCard Credit Card or a Competitive Credit Card Brand is to include the amount of any discount or rebate that is applied to that card or brand at the point of sale but which is not equally applied to all MasterCard Credit Card Transactions.

 

   

“Competitive Credit Card Brand” includes any brand of Credit Card or electronic credit payment form of a nationally accepted payment network other than MasterCard, specifically including without limitation Visa, American Express, Discover, and PayPal.

 

   

“Competitive Credit Card Brand Cost of Acceptance” is the merchant’s average Merchant Discount Rate applicable to transactions on a Competitive Credit Card Brand at the merchant for the preceding one or twelve months, at the merchant’s option.

 

   

“Independent Consideration” means material value a merchant receives specifically in exchange for the merchant’s agreement to waive or otherwise restrict its right to surcharge transactions on a Competitive Credit Card Brand, including, e.g., a material reduction in the Competitive Credit Card Brand’s standard acceptance cost applicable to the merchant (i.e., the cost at which transactions on Competitive Credit Card Brand’s cards are surcharged absent such an agreement).

 

   

The “Maximum Surcharge Cap” shall be no less than the product of 1.8 times the sum of the system-wide average effective U.S. domestic MasterCard Credit Card interchange rate plus average network fees (defined to include network set fees to acquirers or merchants associated with the processing of a transaction or with the acceptance of the network’s brand) as of the Preliminary Approval Date or as subsequently adjusted in accordance with this bullet. To facilitate the determination of the Maximum Surcharge Cap, within 10 business days of the Settlement Preliminary Approval Date, the MasterCard Defendants shall provide Class Counsel with the system-wide average effective U.S. domestic MasterCard Credit Card interchange rate plus average network fees (calculated based upon the preceding 12 month period) and will publish that amount on MasterCard’s website in a manner that is readily visible to merchants. The MasterCard Defendants agree shall adjust the Maximum Surcharge Cap in accordance with

 

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this bullet at least annually, and may adjust the Maximum Surcharge Cap in accordance with this bullet no more than two times per year.

 

   

“Merchant Discount Rate” is the fee, expressed as a percentage of the total transaction amount, that a merchant pays to its acquirer or processor for transacting on a Credit Card brand. For purposes of Paragraph 55(a), Merchant Discount Rate shall include (x) the interchange rate, network set fees associated with the processing of a transaction, network set fees associated with the acceptance of the network’s brand, and the acquirer set processing fees associated with the processing of a transaction, irrespective of whether such fees and costs are paid via the merchant discount or by check, withholding, offset, or otherwise; and (y) any other services for which the acquiring bank is paid via the mechanism of the per transaction merchant discount fee. Other than the fees listed in subpart (x) of the preceding sentence, the Merchant Discount Rate excludes any fees (such as the cost of rental of point-of-sale terminal equipment, for example) that are invoiced separately or not paid via the mechanism of the per transaction merchant discount fee.

 

   

“MasterCard Credit Card” is any Credit Card that bears or uses the name MasterCard or is branded or licensed by MasterCard.

 

   

“MasterCard Credit Card Cost of Acceptance” is the average effective interchange rate plus the average of all fees imposed by the network upon acquirers or merchants, expressed as a percentage of the transaction amount, applicable to MasterCard Credit Card Transactions at the merchant for the preceding one or twelve months, at the merchant’s option. If a merchant cannot determine its MasterCard Credit Card Cost of Acceptance, then the Merchant may use the MasterCard Credit Card Cost of Acceptance for the merchant’s merchant category as published no less than two times each year on MasterCard’s website.

 

   

“MasterCard Credit Card Transaction” is a transaction in which a MasterCard Credit Card is presented for payment and the transaction is subject to MasterCard’s Operating Regulations.

 

   

“MasterCard Surcharge Cap” is the average Merchant Discount Rate applicable to MasterCard Credit Card Transactions at the merchant for the preceding one or twelve months, at the merchant’s option.

(b) Product Level Surcharging: A permitted Product Level Surcharge is one in which:

 

  (i) A merchant adds the same surcharge to all MasterCard Credit Card Transactions of the same product type (e.g., MasterCard Standard Card, MasterCard World Card, MasterCard World Elite Card), regardless of the card’s issuer, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

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  (ii) The surcharge on each MasterCard Credit Card Transaction is no greater than the merchant’s MasterCard Credit Surcharge Cap for that product type minus the Debit Card Cost of Acceptance;

 

  (iii) The surcharge on each MasterCard Credit Card Transaction does not exceed the Maximum Surcharge Cap, if the MasterCard Defendants elect to set a Maximum Surcharge Cap and post on the MasterCard website the information set forth below in the first sentence of the definition of Maximum Surcharge Cap;

 

  (iv) If a merchant’s ability to surcharge any Competitive Credit Card Brand that the merchant accepts in a channel of commerce (either face-to-face or not face-to-face) is limited in any manner by that Competitive Credit Card Brand, other than by prohibiting a surcharge greater than the Competitive Credit Card Brand’s Cost of Acceptance, then the merchant may surcharge MasterCard Credit Card Transactions, consistent with the other terms of this Paragraph 55(b), only on either the same conditions on which the merchant would be allowed to surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, or on the terms on which the merchant actually does surcharge transactions of that Competitive Credit Card Brand in the same channel of commerce, after accounting for any discounts or rebates offered at the point of sale;

 

  (v) The requirements of Paragraph 55(b)(iv) do not apply to the extent that

 

  (A) the Competitive Credit Card Product Cost of Acceptance to the merchant is less than the MasterCard Credit Card Product Cost of Acceptance to that merchant and the Competitive Credit Card Brand does not prohibit or effectively prohibit surcharging Credit Cards (a rule, by-law, regulation or contract provision that provides in words or substance for no discrimination or equal treatment applicable to Credit Cards only is not deemed to “prohibit or effectively prohibit surcharging Credit Cards” under this provision); or

 

  (B) the Competitive Credit Card Brand prohibits or effectively prohibits surcharging Credit Cards and the merchant actually surcharges the Competitive Credit Card Brand in an amount at least equal to the lesser of (I) the Competitive Credit Card Brand Cost of Acceptance or (II) the amount of surcharge imposed on the MasterCard Credit Card Transaction to be surcharged; or

 

  (C)

there is an agreement between the merchant and the Competitive Credit Card Brand in which the merchant waives or in any other way restrains or limits its ability to surcharge transactions on that Competitive Credit Card Brand, as long as: (I) the agreement is for a fixed duration, is not subject to an evergreen clause, and is individually negotiated with the merchant and is not a standard agreement or part of a standard agreement generally offered by the Competitive Credit Card Brand to multiple

 

58


  merchants, (II) the merchant’s acceptance of the Competitive Credit Card Brand as payment for goods and services is unrelated to and not conditioned upon the merchant’s entry into such an agreement, (III) any such agreement or waiver is supported by Independent Consideration, and (IV) the agreement expressly specifies a price under which the merchant may accept transactions on the Competitive Credit Card Brand and surcharge those transactions up to the merchant’s Merchant Discount Rate for the Competitive Credit Card Brand, after accounting for any discounts or rebates offered by the merchant at the point of sale;

 

  (D) For avoidance of doubt, for as long as Visa or MasterCard complies with the provisions of this Paragraph 42 or Paragraph 55, respectively, or any other Competitive Credit Card Brand has rules that are consistent with and no more restrictive than the provisions of this Paragraph 42 and Paragraph 55, each shall be deemed not to limit surcharging for purposes of this Paragraph;

 

  (vi) The merchant does not engage in surcharging at the brand level as described in Paragraph 55(a) above; and

 

  (vii) The merchant complies with the merchant surcharging disclosure requirements set forth in Paragraph 55(c) below.

As used in this Paragraph 55(b):

 

   

“After accounting for any discounts or rebates offered by the merchant at the point of sale” means that the amount of the surcharge for MasterCard Credit Cards of the same product type or a Competitive Credit Card Product is to include the amount of any discount or rebate that is applied to that card or product at the point of sale but which is not equally applied to all MasterCard Credit Card Transactions of the same product type.

 

   

“Competitive Credit Card Product” includes any product within a brand of Credit Card or electronic credit payment form of a nationally accepted payment network other than MasterCard, specifically including without limitation Visa, American Express, Discover, and PayPal.

 

   

“Competitive Credit Card Product Cost of Acceptance” is the merchant’s average effective Merchant Discount Rate applicable to transactions on the Competitive Credit Card Product at the merchant for the preceding one or twelve months at the merchant’s option.

 

   

“Debit Card Cost of Acceptance” is the amount of the cap for debit transactions established by the Board of Governors of the Federal Reserve System pursuant to 15 U.S.C. § 1693o-2 and its implementing regulations or, if the Board of Governors discontinues establishing a cap for debit transactions, the merchant’s average effective Merchant Discount Rate for all PIN-based debit transactions for the preceding twelve months.

 

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“Independent Consideration” means material value a merchant receives specifically in exchange for the merchant’s agreement to waive or otherwise restrict its right to surcharge transactions on a Competitive Credit Card Brand, including, e.g., a material reduction in the Competitive Credit Card Brand’s standard acceptance cost applicable to the merchant (i.e., the cost at which transactions on Competitive Credit Card Brand’s cards are surcharged absent such an agreement).

 

   

The “Maximum Surcharge Cap” shall be no less than the product of 1.8 times the sum of the system-wide average effective U.S. domestic MasterCard Credit Card interchange rate plus average network fees (defined to include network set fees to acquirers or merchants associated with the processing of a transaction or with the acceptance of the network’s brand) as of the Preliminary Approval Date or as subsequently adjusted in accordance with this bullet. To facilitate the determination of the Maximum Surcharge Cap, within 10 business days of the Settlement Preliminary Approval Date, the MasterCard Defendants shall provide Class Counsel with the system-wide average effective U.S. domestic MasterCard Credit Card interchange rate plus average network fees (calculated based upon the preceding 12 month period) and will publish that amount on MasterCard’s website in a manner that is readily visible to merchants. The MasterCard Defendants agree shall adjust the Maximum Surcharge Cap in accordance with this bullet at least annually, and may adjust the Maximum Surcharge Cap in accordance with this bullet no more than two times per year.

 

   

“Merchant Discount Rate” is the fee, expressed as a percentage of the total transaction amount, that a merchant pays to its acquirer or processor for transacting on a Credit Card brand. For purposes of Paragraph 55(a), Merchant Discount Rate includes (x) the interchange rate, network set fees associated with the processing of a transaction, network set fees associated with the acceptance of the network’s brand, and the acquirer set processing fees associated with the processing of a transaction, irrespective of whether such fees and costs are paid via the merchant discount or by check, withholding, offset, or otherwise; and (y) any other services for which the acquiring bank is paid via the mechanism of the per transaction merchant discount fee. Other than the fees listed in subpart (x) of the preceding sentence, the Merchant Discount Rate excludes any fees (such as the cost of rental of point-of-sale terminal equipment, for example) that are invoiced separately or not paid via the mechanism of the per transaction merchant discount fee.

 

   

“MasterCard Credit Card” is any Credit Card that bears or uses the name MasterCard or is branded or licensed by MasterCard.

 

   

“MasterCard Credit Card Product Cost of Acceptance” is the average effective interchange rate plus the average of all fees imposed by the network upon acquirers or merchants, expressed as a percentage of the transaction amount, applicable to MasterCard Credit Card Transactions of a product type at the merchant for the preceding one or twelve months, at the merchant’s option. If a

 

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merchant cannot determine its MasterCard Credit Card Product Cost of Acceptance, then the Merchant may use the MasterCard Credit Card Product Cost of Acceptance for the merchant’s merchant category as published no less than two times each year on MasterCard’s website.

 

   

“MasterCard Credit Card Transaction” is a transaction in which a MasterCard Credit Card is presented for payment and the transaction is subject to MasterCard’s Operating Regulations.

 

   

“MasterCard Credit Surcharge Cap” for a product type is the average effective Merchant Discount Rate applicable to MasterCard Credit Card Transactions of that product type at the merchant for the preceding twelve months. At any given point in time, the actual Merchant Discount Rate paid in the time period covered by the merchant’s most recent statement relating to MasterCard Credit Card Transactions may be deemed a proxy for the MasterCard Credit Card Cost of Acceptance.

(c) Merchant Surcharging Disclosure Requirements: A merchant’s ability to apply either a Brand Level or Product Level Surcharge is conditioned on the merchant’s agreement to abide by the following disclosure requirements. A merchant must:

 

  (i) Provide MasterCard and the merchant’s acquirer with no less than thirty days’ advance written notice that the merchant intends to impose surcharges, which shall identify whether the merchant intends to impose surcharges at the brand level or the product level. Any such notice shall be treated confidentially by the MasterCard Defendants and the merchant’s acquirer.

 

  (ii) Provide clear disclosure to the merchant’s customers at the point of store entry, or in an online environment on the first page that references Credit Card brands, that the merchant imposes a surcharge that is not greater than the applicable Merchant Discount Rate for MasterCard Credit Card Transactions at the merchant.

 

  (iii)

Provide clear disclosure to the merchant’s customers of the merchant’s surcharging practices, at the point of interaction or sale with the customer, in a manner that does not disparage the brand, network, issuing bank, or the payment card product being used. By way of illustration and without limitation, disparagement does not include a merchant’s statement in words or substance that the merchant prefers or requests that a cardholder pay with a Credit Card or Debit Card that has a lower cost of acceptance to the merchant than the payment card presented for payment by the cardholder. The information on the merchant’s surcharging practices at the point of interaction must include (A) the amount of any surcharge that the merchant imposes, (B) a statement that the surcharge is being imposed by the merchant, and (C) a statement that the surcharge that the merchant imposes is not greater than the

 

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  applicable Merchant Discount Rate for MasterCard Credit Card Transactions at the merchant.

 

  (iv) Provide clear disclosure of the dollar amount of the surcharge on the transaction receipt provided by the merchant to the customers.

(d) For the avoidance of doubt, nothing in this Class Settlement Agreement, including Paragraph 55, shall preclude the MasterCard Defendants from maintaining their prohibition of surcharging at the issuer level, i.e., adding surcharges that are not the same, after accounting for any discounts or rebates offered by a merchant at the point of sale, for all MasterCard Credit Cards or all MasterCard Credit Cards of a given product type, regardless of the issuing financial institution; and it is expressly agreed for the purpose of clarity that any claim relating to the past, continued, or future prohibition of such surcharging is within the scope of the Releases and Covenants Not to Sue set forth in Paragraphs 31-38 and 66-74.

(e) The MasterCard Defendants shall modify any other rules as necessary to ensure that the changes set forth in Paragraph 55(a) above are also applicable to merchants located in all United States territories and possessions, and the Commonwealth of Puerto Rico.

(f) Nothing in this Class Settlement Agreement shall prevent the MasterCard Defendants from contracting with merchants not to surcharge MasterCard-Branded Credit Cards or any Product type of MasterCard-Branded Credit Card as long as (i) the agreement is for a fixed duration, (ii) is not subject to an evergreen clause, (iii) is individually negotiated with the merchant or merchants organized in accordance with the provisions of Paragraph 56 below and is not a standard agreement or part of a standard agreement generally by the MasterCard Defendants, and (iv) any such agreement or waiver is supported by Independent Consideration; provided, however, that nothing in this Class Settlement Agreement shall affect any right of the MasterCard Defendants to limit or decline acceptance of MasterCard by a payment aggregator or

 

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payment services provider with a proprietary acceptance mark that surcharges or discriminates against MasterCard.

(g) In the event that MasterCard debit card transactions are no longer subject to the rate cap established by Board of Governors of the Federal Reserve System pursuant to 15 U.S.C. § 1693o-2 and its implementing regulations or any other regulated rate cap that may be subsequently implemented, the MasterCard Defendants will further modify the MasterCard rules to permit merchants to surcharge MasterCard debit card transactions in a manner equivalent to that permitted for MasterCard Credit Card transactions pursuant to Paragraph 55(a) above.

56. Within sixty days after the Settlement Preliminary Approval Date, the MasterCard Defendants shall modify their rules, by-laws, or regulations to the extent necessary to eliminate any restrictions therein on merchants’ rights to properly organize bona fide buying groups that comply with the requirements of the DOJ Guidelines on Competitor Collaboration, the DOJ and FTC’s Statements of Antitrust Enforcement Policy in Health Care, and other applicable legal standards, to negotiate with MasterCard on behalf of members of the buying group. With respect to any proposals that MasterCard believes provides reasonable commercial benefits to the parties, MasterCard will negotiate with such buying groups in an effort to reach a commercially reasonable agreement, and MasterCard agrees to exercise its discretion and business judgment in good faith: (a) in determining whether a proposal sets forth commercially reasonable benefits to the parties; (b) in negotiations related to such proposals; and (c) in making its determination whether to accept or reject a proposal. In the event that any dispute arises with respect to this provision, the parties will be subject to the jurisdiction of, and the dispute shall be resolved by, the Court presiding over this Action, as part of the continuing jurisdiction of the Court over this Settlement and the Rule 23(b)(2) Settlement Class. In the event of such dispute, the party raising the dispute shall be limited to seeking declaratory relief, and to no other form of relief. The

 

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declaratory relief available as to any such dispute shall be limited to deciding whether (y) the putative buying group is a properly organized bona fide buying group that complies with the requirements of this Paragraph, and/or (z) whether MasterCard negotiated in good faith with the putative buying group. The parties, including all members of the Rule 23(b)(2) Settlement Class, waive all rights to appeal from any such determinations. Upon resolution of the dispute by the Court, the losing party shall be responsible for all attorneys’ fees and expenses of the prevailing party unless the Court determines that the circumstances make such an award unjust.

57. In the event that the obligations imposed on the MasterCard Defendants under 15 U.S.C. § 1693o-2(b)(3)(A)(i) not to prohibit merchants from setting a minimum dollar value for acceptance of credit cards that does not differentiate between issuers or payment card networks and that does not exceed $10.00 are terminated before July 20, 2021, those obligations shall thenceforth be imposed on the MasterCard Defendants under this Class Settlement Agreement but only until July 20, 2021.

58. The rules requirements of Paragraphs 53-57 above shall remain in effect until July 20, 2021. The rules requirements of Paragraphs 53-57 above shall expire on July 20, 2021.

59. The MasterCard Defendants retain the right, but are in no way obligated, to further modify their by-laws, rules, operating regulations, practices, policies or procedures addressed in Paragraphs 53-58 in a manner that is more permissive of a merchant’s ability to engage in the point of sale practices described therein; provided, however, that it is expressly agreed for the purpose of clarity that any claim relating to a lack of such further modification of the by-laws, rules, operating regulations, practices, policies, or procedures addressed in Paragraphs 53-58 is within the scope of the Releases and Covenants Not to Sue set forth in Paragraphs 31-38 and 66-74.

 

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60. The MasterCard Defendants shall not be required to modify their by-laws, rules, operating regulations, practices, policies, or procedures in any manner other than as provided in Paragraphs 53-58 above. From the date of execution of this Class Settlement Agreement to the Settlement Preliminary Approval Date, the MasterCard Defendants shall provide Class Counsel with advance notice of any material changes to their by-laws, rules, operating regulations, practices, policies, or procedures that pertain to Paragraphs 53-58 above and Paragraph 61 below. If Class Counsel believe that any of those material changes would result in a breach of this Class Settlement Agreement, they may seek relief from the Court after meeting and conferring with the MasterCard Defendants.

61. Any MasterCard by-laws, rules, operating regulations, practices, policies, or procedures amended pursuant to Paragraphs 53-58 above shall be enforced pursuant to MasterCard’s existing compliance rules and standards, including specifically MasterCard Rules 5.2.2 and 5.10. In the event that MasterCard takes action against a merchant’s acquirer or the merchant for the merchant’s failure to comply with the provisions of Paragraph 55 above, MasterCard shall provide notice of MasterCard’s action to Class Counsel or their designee.

62. No later than thirty days after the Settlement Preliminary Approval Date, and before any modifications of the MasterCard Defendants’ operating regulations necessary to effect Paragraphs 54-56 above become effective, the MasterCard Defendants shall (a) post on the MasterCard website a written notification that describes those modifications, (b) provide that written notification to all MasterCard issuers and acquirers in the United States, and (c) and direct MasterCard acquirers in the United States to provide that written notification to all merchants with whom they have acquiring relationships. The MasterCard Defendants agree to provide Class Counsel with an opportunity to offer comments on the language of that written notification.

 

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63. Nothing in the foregoing changes to the MasterCard Defendants’ rules, by-laws, and/or operating regulations described in Paragraphs 53-58 above shall affect any obligation of any member of the Rule 23(b)(2) Settlement Class to comply with all applicable state or federal laws, including but not limited to state laws regarding surcharging of credit or debit card transactions, and federal and state laws regarding deceptive or misleading disclosures.

64. Nothing in this Class Settlement Agreement shall limit the ability of any MasterCard Defendant to set interchange rates, whether default rates or rates applicable (either by rule or negotiated agreement) to individual merchants, groups of merchants, or merchant trade associations.

65. Nothing in this Class Settlement Agreement shall impose any limitation upon any other conduct of any Rule 23(b)(2) Settlement Class Released Defendant not expressly modified by the terms hereof.

Release and Covenant Not to Sue of Rule 23(b)(2) Settlement Class

66. The “Rule 23(b)(2) Settlement Class Releasing Parties” are the Class Plaintiffs, each and every member of the Rule 23(b)(2) Settlement Class, and any of their respective past, present, or future: officers and directors; stockholders, agents, employees, legal representatives, partners, and associates (in their capacities as stockholders, agents, employees, legal representatives, partners, and associates of a member of the Rule 23(b)(2) Settlement Class only); and trustees, parents, subsidiaries, divisions, affiliates, heirs, executors, administrators, purchasers, predecessors, successors, and assigns — whether or not they object to this Class Settlement Agreement, and whether or not they exercise any benefit provided under the Class Settlement Agreement, whether directly, representatively, derivatively, or in any other capacity.

 

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67. The “Rule 23(b)(2) Settlement Class Released Parties” are all of the following:

(a) Visa U.S.A. Inc., Visa International Service Association, Visa Inc., Visa Asia Pacific Region, Visa Canada Association, Visa Central & Eastern Europe, Middle East & Africa Region, Visa Europe, Visa Europe Limited, Visa Latin America & Caribbean Region, and any other entity that now authorizes or licenses, or in the past has authorized or licensed, a financial institution to issue any Visa-Branded Cards or to acquire any Visa-Branded Card transactions.

(b) MasterCard International Incorporated, MasterCard Incorporated, and any other entity that now authorizes or licenses, or in the past has authorized or licensed, a financial institution to issue any MasterCard-Branded Cards or to acquire any MasterCard-Branded Card transactions.

(c) Bank of America, N.A.; BA Merchant Services LLC (formerly known as National Processing, Inc.); Bank of America Corporation; MBNA America Bank, N.A., and FIA Card Services, N.A.

(d) Barclays Bank plc; Barclays Bank Delaware; and Barclays Financial Corp.

(e) Capital One Bank (USA), N.A.; Capital One F.S.B.; and Capital One Financial Corporation.

(f) Chase Bank USA, N.A.; Chase Manhattan Bank USA, N.A.; Chase Paymentech Solutions, LLC; JPMorgan Chase Bank, N.A.; JPMorgan Chase & Co.; Bank One Corporation; and Bank One Delaware, N.A.

(g) Citibank (South Dakota), N.A.; Citibank N.A.; Citigroup Inc.; and Citicorp.

(h) Fifth Third Bancorp.

(i) First National Bank of Omaha.

 

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(j) HSBC Finance Corporation; HSBC Bank USA, N.A.; HSBC North America Holdings Inc.; HSBC Holdings plc; and HSBC Bank plc.

(k) National City Corporation and National City Bank of Kentucky.

(l) SunTrust Banks, Inc. and SunTrust Bank.

(m) Texas Independent Bancshares, Inc.

(n) Wachovia Bank, N.A. and Wachovia Corporation.

(o) Washington Mutual, Inc.; Washington Mutual Bank; Providian National Bank (also known as Washington Mutual Card Services, Inc.); and Providian Financial Corporation.

(p) Wells Fargo & Company and Wells Fargo Bank, N.A.

(q) Each and every entity or person alleged to be a co-conspirator of any Defendant in any of the Operative Class Complaints or any of the Class Actions.

(r) Each of the past, present, or future member or customer financial institutions of Visa U.S.A. Inc., Visa International Service Association, Visa Inc., Visa Europe, Visa Europe Limited, MasterCard International Incorporated, or MasterCard Incorporated.

(s) For each of the entities or persons in Paragraphs 67(a)-(r) above, each of their respective past, present, and future, direct and indirect, parents (including holding companies), subsidiaries, affiliates, and associates (all as defined in SEC Rule 12b-2 promulgated pursuant to the Securities Exchange Act of 1934), or any other entity in which more than 50% of the equity interests are held.

(t) For each of the entities or persons in Paragraphs 67(a)-(s) above, each of their respective past, present, and future predecessors, successors, purchasers, and assigns (including acquirers of all or substantially all of the assets, stock, or other ownership interests of

 

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any of the Defendants to the extent a successor’s, purchaser’s, or acquirer’s liability is based on the Rule 23(b)(2) Settlement Class Released Parties as defined in Paragraphs 67(a)-(s) above).

(u) For each of the entities or persons in Paragraphs 67(a)-(t) above, each of their respective past, present, and future principals, trustees, partners, officers, directors, employees, agents, attorneys, legal or other representatives, trustees, heirs, executors, administrators, shareholders, advisors, predecessors, successors, purchasers, and assigns (including acquirers of all or substantially all of the assets, stock, or other ownership interests of each of the foregoing entities to the extent a successor’s, purchaser’s, or acquirer’s liability is based on the Rule 23(b)(2) Settlement Class Released Parties as defined in Paragraphs 67(a)-(t) above).

68. This release applies solely to the Rule 23(b)(2) Settlement Class Releasing Parties. In addition to the effect of the Class Settlement Order and Final Judgment entered in accordance with this Class Settlement Agreement, including but not limited to any res judicata effect, the Rule 23(b)(2) Settlement Class Releasing Parties hereby expressly and irrevocably waive, and fully, finally, and forever settle, discharge, and release the Rule 23(b)(2) Settlement Class Released Parties from any and all manner of claims, demands, actions, suits, and causes of action, whether individual, class, representative, parens patriae, or otherwise in nature, for any form of declaratory, injunctive, or equitable relief, or any damages or other monetary relief relating to the period after the date of the Court’s entry of the Class Settlement Preliminary Approval Order, regardless of when such claims accrue, whether known or unknown, suspected or unsuspected, in law or in equity that any Rule 23(b)(2) Settlement Class Releasing Party now has, or hereafter can, shall, or may in the future have, arising out of or relating in any way to any conduct, acts, transactions, events, occurrences, statements, omissions, or failures to act of any Rule 23(b)(2) Settlement Class Released Party that are alleged or which could have been alleged

 

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from the beginning of time until the date of the Court’s entry of the Class Settlement Preliminary Approval Order in any of the Operative Class Complaints or Class Action complaints, or in any amendments to the Operative Class Complaints or Class Action complaints, including but not limited to any claims based on or relating to:

(a) any interchange rules, interchange fees, or interchange rates, or any other Rule of any Visa Defendant or MasterCard Defendant, or any agreement involving any Visa Defendant or any MasterCard Defendant and any other Rule 23(b)(2) Settlement Class Released Party, and/or any merchant arising out of or relating to interchange rules, interchange fees, or interchange rates, card issuance, or card acceptance with respect to any Visa-Branded Card transactions in the United States or any MasterCard-Branded Card transactions in the United States;

(b) any Merchant Fee of any Rule 23(b)(2) Settlement Released Party relating to any Visa-Branded Card transactions in the United States or any MasterCard-Branded Card transactions in the United States;

(c) any actual or alleged “no surcharge” rules, “honor all cards” rules, “no minimum purchase” rules, “no discounting” rules, “non-discrimination” rules, “anti-steering” rules, Rules that limit merchants in favoring or steering customers to use certain payment systems, “all outlets” rules, “no bypass” rules, or “no multi-issuer” rules, or any other actual or alleged Rule of any Rule 23(b)(2) Settlement Class Released Party relating to any Visa-Branded Cards or any MasterCard-Branded Cards, or a merchant’s point of sale practices relating to any Visa-Branded Cards or any MasterCard-Branded Cards;

(d) any actual or alleged agreement (i) between or among any Visa Defendant and any MasterCard Defendant, (ii) between or among any Visa Defendant or MasterCard Defendant and any other Rule 23(b)(2) Settlement Class Released Party or Parties, or

 

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(iii) between or among any Visa Defendant, MasterCard Defendant, or any other Rule 23(b)(2) Settlement Class Released Party or Parties relating to conduct or Rules of any Visa Defendant or any MasterCard Defendant;

(e) any reorganization, restructuring, initial or other public offering, or other corporate structuring of any Visa Defendant or MasterCard Defendant;

(f) any service of an employee or agent of any Rule 23(b)(2) Settlement Class Released Party on any board or committee of any Visa Defendant or MasterCard Defendant;

(g) the future effect in the United States of the continued imposition of or adherence to any Rule of any Visa Defendant or MasterCard Defendant in effect in the United States as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order, any Rule modified or to be modified pursuant to this Class Settlement Agreement, or any Rule that is substantially similar to any Rule in effect in the United States as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order or any Rule modified or to be modified pursuant to this Class Settlement Agreement;

(h) the future effect in the United States of any conduct of any Rule 23(b)(2) Settlement Class Released Party substantially similar to the conduct of any Rule 23(b)(2) Settlement Class Released Party related to or arising out of interchange rules, interchange fees, or interchange rates, any Rule of any Visa Defendant or MasterCard Defendant modified or to be modified pursuant to this Class Settlement Agreement, any other Rule of any Visa Defendant or any MasterCard Defendant in effect as of the date of the Court’s entry of the Class Settlement Preliminary Approval Order, or any Rule substantially similar to any of the foregoing Rules;

(i) any conduct of this Action, including without limitation any settlement discussions relating to this Action, the negotiation of and agreement to this Class Settlement Agreement by the Defendants or any member or customer financial institution of the Visa

 

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Defendants or the MasterCard Defendants, or any terms or effect of this Class Settlement Agreement (other than claims to enforce this Class Settlement Agreement), including any changes in the Rule 23(b)(2) Settlement Class Released Parties’ Rules as a result of this Class Settlement Agreement;

and it is expressly agreed, for purposes of clarity, without expanding or limiting the foregoing, that any claims based on or relating to (a)-(i) above are claims that were or could have been alleged in this Action.

Provided, however, that any Opt Out that is also a member of the Rule 23(b)(2) Settlement Class shall not be deemed to have released any claims for damages based on any Rules or other conduct, acts, transactions, events, occurrences, statements, omissions, or failures to act of any Rule 23(b)(3) Settlement Class Released Party prior to the date of the Court’s entry of the Class Settlement Preliminary Approval Order.

69. Each Rule 23(b)(2) Settlement Class Releasing Party further expressly and irrevocably waives, and fully, finally, and forever settles and releases, any and all defenses, rights, and benefits that the Rule 23(b)(2) Settlement Class Releasing Party may have or that may be derived from the provisions of applicable law which, absent such waiver, may limit the extent or effect of the release contained in the preceding Paragraphs 66-68. Without limiting the generality of the foregoing, each Rule 23(b)(2) Settlement Class Releasing Party expressly and irrevocably waives and releases any and all defenses, rights, and benefits that the Rule 23(b)(2) Settlement Class Releasing Party might otherwise have in relation to the release by virtue of the provisions of California Civil Code Section 1542 or similar laws of any other state or jurisdiction. SECTION 1542 PROVIDES: “CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE. A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT

 

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THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.” In addition, although each Rule 23(b)(2) Settlement Class Releasing Party may hereafter discover facts other than, different from, or in addition to those that it or he or she knows or believes to be true with respect to any claims released in the preceding Paragraphs 66-68, each Rule 23(b)(2) Settlement Class Releasing Party hereby expressly waives, and fully, finally, and forever settles, discharges, and releases, any known or unknown, suspected or unsuspected, contingent or non-contingent claims within the scope of the preceding Paragraphs 66-68, whether or not concealed or hidden, and without regard to the subsequent discovery or existence of such other, different, or additional facts. Class Plaintiffs acknowledge, and the members of the Rule 23(b)(2) Settlement Class shall be deemed by operation of the Class Settlement Order and Final Judgment to have acknowledged, that the foregoing waiver was separately bargained for and is a key element of this Class Settlement Agreement.

70. Each Rule 23(b)(2) Settlement Class Releasing Party covenants and agrees that it shall not, hereafter, seek to establish, or permit another to act for it in a representative capacity to seek to establish, liability against any of the Rule 23(b)(2) Settlement Class Released Parties based, in whole or in part, upon any conduct covered by any of the claims released in Paragraphs 66-69 above.

71. For purposes of clarity, it is specifically intended for the release and covenant not to sue provisions of Paragraphs 66-70 above to preclude all members of the Rule 23(b)(2) Settlement Class from seeking or obtaining any form of declaratory, injunctive, or equitable relief, or damages or other monetary relief relating to the period after the date of the Court’s entry of the Class Settlement Preliminary Approval Order with respect to any Rule of any Visa Defendant or any MasterCard Defendant, and the compliance by any Bank Defendant with any

 

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such Rule, as it is alleged to exist, now exists, may be modified in the manner provided in Paragraphs 40-45 and 53-57 above, or may in the future exist in the same or substantially similar form thereto.

72. For avoidance of doubt, no other provision of this Class Settlement Agreement releases any claim of a Rule 23(b)(2) Settlement Class Releasing Party that is based on:

(a) breach of this Class Settlement Agreement;

(b) standard commercial disputes arising in the ordinary course of business under contracts or commercial relations regarding loans, lines of credit, or other related banking or credit relations, individual chargeback disputes, products liability, breach of warranty, misappropriation of cardholder data or invasion of privacy, compliance with technical specifications for a merchant’s acceptance of Credit Cards or Debit Cards, and any other dispute arising out of a breach of any contract between any of the Rule 23(b)(2) Settlement Class Releasing Parties and any of the Rule 23(b)(2) Settlement Class Released Parties; provided, however, that Paragraphs 66-71 above and not this Paragraph shall control in the event that any such claim challenges the legality of interchange rules, interchange rates, or interchange fees, or any other Rule, fee, charge, or other conduct covered by any of the claims released in Paragraphs 66-71 above;

(c) the claims alleged in the currently operative complaints against the current defendants in (i) NACS, et al. v. Board of Governors of the Federal Reserve System, No. 11-CV-02075-RJL (D.D.C.), and (ii) In re ATM Fee Antitrust Litigation, No. 04-CV-02676-CRB (N.D. Cal) (including claims that have been asserted to have been alleged in the Second Amended or Third Amended Complaints against Bank of America, N.A.); or

(d) a claim seeking only injunctive relief against only the Visa Defendants regarding the legality of Visa’s Fixed Acquirer Network Fee.

 

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73. Each Rule 23(b)(2) Settlement Class Releasing Party further releases each of the Visa Defendants, MasterCard Defendants, and Bank Defendants and their counsel and experts in this Action from any claims relating to the defense of this Action, including the negotiation and terms of this Class Settlement Agreement, except for any claims relating to enforcement of this Class Settlement Agreement. Each Visa Defendant, MasterCard Defendant, and Bank Defendant releases the Class Plaintiffs, other plaintiffs in the Class Actions, Class Counsel, Class Plaintiffs’ other counsel who have participated in any settlement conferences before the Court for a Class Plaintiff that executes this Class Settlement Agreement, and their respective experts in the Class Actions, from any claims relating to their institution or prosecution of the Class Actions, including the negotiation and terms of this Class Settlement Agreement, except for any claims relating to enforcement of this Class Settlement Agreement.

74. In the event that this Class Settlement Agreement is terminated pursuant to Paragraphs 96-98 below, or any condition for the Settlement Final Approval Date is not satisfied, the release and covenant not to sue provisions of Paragraphs 66-73 above shall be null and void and unenforceable.

Preliminary Court Approval

75. Class Plaintiffs, Class Counsel, and Defendants agree to use reasonable and good faith efforts to effectuate the Court’s preliminary approval of this Class Settlement Agreement, including filing necessary motion papers and scheduling any necessary hearings for a date and time that are convenient for the Court.

76. Separately from any motions for Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards, the Class Plaintiffs and Class Counsel agree to file with the Court a motion and supporting papers seeking preliminary approval of this Class Settlement Agreement, after providing Defendants with at least ten days advance notice of the contents of those papers,

 

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and to seek the Court’s entry of the Class Settlement Preliminary Approval Order in the form in Appendix D hereto, which will:

(a) Preliminarily approve this Class Settlement Agreement as being within the range of a fair, reasonable, and adequate settlement within the meaning of Federal Rule of Civil Procedure 23 and applicable law, and consistent with due process.

(b) Approve the provisional certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class defined in Paragraph 2 above for settlement purposes only, and declare that in the event of termination of this Class Settlement Agreement, certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class shall automatically be vacated and each Defendant may fully contest certification of any class as if no Rule 23(b)(3) Settlement Class or Rule 23(b)(2) Settlement Class had been certified.

(c) Appoint as Class Counsel the law firms of Robins, Kaplan, Miller & Ciresi L.L.P., Berger & Montague, P.C., and Robbins Geller Rudman & Dowd LLP.

(d) Appoint Epiq Systems, Inc. as the Class Administrator to assist Class Counsel in effectuating and administering the Notice Plan and the exclusion process for Opt Outs, in analyzing and evaluating the amount of the Class Exclusion Takedown Payments and the Default Interchange Payments, and in effectuating and administering the claims process for members of the Rule 23(b)(3) Settlement Class.

(e) Determine that notice should be provided to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, but that exclusion rights should be afforded only to members of the Rule 23(b)(3) Settlement Class.

(f) Approve the method of notice to be provided to the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class in substantially the form described in the Notice Plan and budget contained in Appendix E hereto, including use of the long-form

 

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website and mail notice and the publication notice contained in Appendix F hereto, and direct any further notice (and expenses therefor) that the Court may find necessary to provide due process.

(g) Approve the procedures in substantially the form described in the Notice Plan and below for members of the Rule 23(b)(3) Settlement Class to become Opt Outs and exclude themselves from the Rule 23(b)(3) Settlement Class, and including the provision of the information specified in Paragraph 84 below, and approve the procedures in substantially the form described in the Notice Plan and below for members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class to object to this Class Settlement Agreement.

(h) Schedule a final approval hearing for a time and date convenient for the Court at least two hundred eighty five days after the Court’s entry of the Class Settlement Preliminary Approval Order, at which hearing the Court will conduct an inquiry into the fairness, reasonableness, and adequacy of this Class Settlement Agreement and address any objections to it, and determine whether this Class Settlement Agreement and the Plan of Administration and Distribution should be finally approved, and whether to approve any motions for Attorneys’ Fee Awards, Expense Awards, and Class Plaintiffs’ Awards.

(i) Stay all further proceedings in this Action as between the Class Plaintiffs or any other plaintiff in a putative class action consolidated in MDL 1720, and the Defendants or any other defendant in a putative class action consolidated in MDL 1720, except for proceedings in MDL 1720 related to effectuating and complying with this Class Settlement Agreement, pending the Court’s determination of whether this Class Settlement Agreement should be finally approved or the termination of this Class Settlement Agreement.

(j) Enjoin the members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, pending the Court’s determination of whether this Class Settlement

 

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should finally be approved or the termination of this Class Settlement Agreement, from challenging in any action or proceeding any matter covered by this Class Settlement Agreement or its release and covenant not to sue provisions, except for (i) proceedings in MDL 1720 related to effectuating and complying with this Class Settlement Agreement, and (ii) any Opt Out’s claims for damages based on any conduct, acts, transactions, events, occurrences, statements, omissions, or failures to act of any Rule 23(b)(3) Settlement Class Released Party prior to the date of the Court’s entry of the Class Settlement Preliminary Approval Order.

77. Prior to forty five days before the end of the Class Exclusion Period and Class Objection Period specified in Paragraphs 83 and 85 below, Class Counsel will file all motion and supporting papers seeking the Court’s final approval of this Class Settlement Agreement, and any Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards with respect to any Class Action, so that notice of such motion or motions and any awards sought may be provided to members of the Rule 23(b)(3) Settlement Class and to the Rule 23(b)(2) Settlement Class under the Notice Plan.

78. Within ten days after the filing with the Court of this Class Settlement Agreement and the accompanying motion papers seeking its preliminary approval, the Defendants shall cause notice of the Class Settlement Agreement to be served upon appropriate State and Federal officials as provided in the Class Action Fairness Act, 28 U.S.C. § 1715.

Class Settlement Notice and Exclusion Procedures

79. Class Counsel and the Class Administrator shall carry out the settlement notice and exclusion procedures as ordered by the Court, and shall perform such related duties as may be necessary to provide those notice and exclusion procedures.

80. As soon as practicable following the Court’s entry of the Class Settlement Preliminary Approval Order, but before commencement of the mail and publication notice, the

 

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Class Administrator shall establish the dedicated Case Website, post office box, and toll-free telephone line for providing notice and information to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, and receiving exclusion requests from members of the Rule 23(b)(3) Settlement Class, as provided in the Class Settlement Preliminary Approval Order and the Notice Plan contained in Appendices C and D hereto.

81. Commencing immediately and in no event later than twenty days following the Court’s entry of the Class Settlement Preliminary Approval Order:

(a) The Visa Defendants shall provide to Class Counsel, in machine readable format where available, information from the Visa SQL-AIM database and the Visa Merchant Profile Database as can be produced without undue burden and that is identified by Class Counsel as reasonably necessary to effectuate the Notice Plan and the Plan of Administration and Distribution. The Visa Defendants shall also provide reasonable cooperation and assistance to Class Counsel and/or the Class Administrator in understanding and utilizing such information for purposes of effectuating the Notice Plan and Plan of Administration and Distribution. The parties shall cooperate to ensure that the information is produced and cooperation given without imposing any undue burden on the Visa Defendants. The Visa Defendants shall also provide readily available contact information for the largest non-Bank Defendant acquirers identified in Paragraph 79(d) below.

(b) The MasterCard Defendants shall provide to Class Counsel, in machine readable format where available, information that may be obtained through searches of its data bases (in a manner consistent with MasterCard’s prior production of aggregated merchant and transactional data in MDL 1720) as can be produced without undue burden and that is identified by Class Counsel as reasonably necessary to effectuate the Notice Plan and Plan of Administration and Distribution. The MasterCard Defendants shall also provide reasonable

 

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cooperation and assistance to Class Counsel and/or the Class Administrator in understanding and utilizing such information for purposes of effectuating the Notice Plan and Plan of Administration and Distribution. The parties shall cooperate to ensure that the information is produced and cooperation given without imposing any undue burden on the MasterCard Defendants. The MasterCard Defendants shall also provide readily available contact information for the largest non-Bank Defendant acquirers identified in Paragraph 79(d) below.

(c) The Bank Defendants shall provide to Class Counsel, in machine readable format where available, information as can be produced without undue burden and that is identified by Class Counsel as reasonably necessary to effectuate the Notice Plan and Plan of Administration and Distribution. The Bank Defendants shall also provide reasonable cooperation and assistance to Class Counsel and/or the Class Administrator in understanding and utilizing such information for purposes of effectuating the Notice Plan and Plan of Administration and Distribution. The parties shall cooperate to ensure that the information is produced and cooperation given without imposing any undue burden on the Bank Defendants.

(d) The Class Plaintiffs shall subpoena, to obtain the names and locations of any members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, as many non-Bank Defendant acquirers as would be necessary to attempt to obtain merchant name and location information attributable to more than 90% of merchant transaction volume and 90% of merchant outlets as reported in Nilson Report 990 (March 2012).

82. Within ninety days following the Court’s entry of the Class Settlement Preliminary Approval Order, the Class Administrator shall complete the mail and publication notice to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, using the long form mail notice and the publication notice contained in Appendix F hereto, as

 

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provided in the Class Settlement Preliminary Approval Order and the Notice Plan contained in Appendices D and E hereto, or as otherwise ordered by the Court.

83. As explained in the long-form notice and publication notice contained in Appendix F hereto, any member of the Rule 23(b)(3) Settlement Class that does not wish to participate in the Rule 23(b)(3) Settlement Class shall have until one hundred eighty days after the Court’s entry of the Class Settlement Preliminary Approval Order — i.e., ninety days after the last date for completion of the mail and publication notice (the “Class Exclusion Period”) — to submit a request to become an Opt Out and be excluded from the Rule 23(b)(3) Settlement Class.

84. A member of the Rule 23(b)(3) Settlement Class may effect such an exclusion by sending a written request to the Class Administrator, by first-class mail with postage prepaid and postmarked within the Class Exclusion Period. The written request must be signed by a person authorized to do so, and provide all of the following information:

(a) The words “In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation.”

(b) A statement of the Rule 23(b)(3) Settlement Class member’s full name, address, telephone number, and taxpayer identification number.

(c) A statement that the Rule 23(b)(3) Settlement Class member desires to be excluded from the Rule 23(b)(3) Settlement Class, and by what position or authority he or she has the power to exclude the member from the Rule 23(b)(3) Settlement Class.

(d) The business names, brand names, and addresses of any stores or sales locations whose sales the Rule 23(b)(3) Settlement Class member desires to be excluded from the Rule 23(b)(3) Settlement Class.

 

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85. As also explained in the long-form notice and publication notice contained in Appendix F hereto, any Rule 23(b)(3) Settlement Class member that does not submit a request for exclusion, or any Rule 23(b)(2) Settlement Class member, shall have until one hundred eighty days after the Court’s entry of the Class Settlement Preliminary Approval Order — i.e., ninety days after the last date for completion of the mail and publication notice (the “Class Objection Period”) — to submit an objection to this Class Settlement Agreement (be an “Objector”) and any notice to appear.

86. Such an Objector must file with the Court within the Class Objection Period and send to a designee of Class Counsel and a designee of counsel for the Defendants, by first-class mail and postmarked within the Class Objection Period, a written statement of objections. The Objector’s statement must: (a) contain the words “In re Interchange Fee and Merchant Discount Antitrust Litigation”; (b) state each and every objection of the Objector and the specific reasons therefor; (c) provide all legal support and all evidence that the Objector wishes to bring to the Court’s attention in support of any objection; (d) state the full name and address and telephone number of the Objector; (e) provide information sufficient to establish that the Objector is a Rule 23(b)(3) Settlement Class Member and/or a Rule 23(b)(2) Settlement Class member; and (f) state the full name, mail address, email address, and telephone number of any counsel representing the Objector in connection with the objections.

87. In addition, any Objector or counsel for an Objector that desires to appear at the final approval hearing must file with the Court within the Class Objection Period, and send to a designee of Class Counsel and a designee of counsel for the Defendants by first class mail and postmarked within the Class Objection Period, a separate notice of intention to appear that identifies by name, position, address, and telephone number each person who intends to appear at the final approval hearing on behalf of the Objector.

 

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88. Upon receipt of any objection or notice of intention to appear, whether as provided in Paragraphs 86-87 above or otherwise, the designees of Class Counsel and counsel for the Defendants shall confer to ensure that they each receive a complete copy of all objections and any notice of intention to appear.

89. Within one hundred ninety-five days after the Court’s entry of the Class Settlement Preliminary Approval Order — i.e., within fifteen days after the conclusion of the Class Exclusion Period — the Class Administrator shall prepare and file with the Court, and provide to a designee of Class Counsel, a designee of counsel for the Visa Defendants, a designee of counsel for the MasterCard Defendants, and a designee of counsel for the Bank Defendants, a report that:

(a) Confirms that the Notice Plan was carried out and that the website notice, mail notice, publication notice, and any other notice to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class was provided in the manner directed by the Court.

(b) Identifies the date when the Case Website was fully established and its content made available to the members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, the date or dates on which mail notices were mailed, the dates of the publication notices, and the date or dates of any other notice directed by the Court.

(c) Lists each member of the Rule 23(b)(3) Settlement Class that sought to become an Opt Out and be excluded from the Rule 23(b)(3) Settlement Class, and on what date the request to be excluded was postmarked and received, and states whether the Rule 23(b)(3) Settlement Class member’s request for exclusion was timely and properly made.

(d) Attaches a copy of all documentation concerning each request for exclusion that the Class Administrator received, with any taxpayer identification number, or other confidential information filed under seal with the Court.

 

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90. After receipt of the Class Administrator’s report and its supporting documentation, the Class Exclusion Takedown Payments will be determined as follows:

(a) Within fifteen days or as soon thereafter as is reasonably practicable, the Visa Defendants and the MasterCard Defendants shall provide Class Counsel and the Class Administrator with a report that calculates, based on the Opt Outs, the Class Exclusion Takedown Payments that should be made to the Visa Defendants and to the MasterCard Defendants pursuant to Paragraphs 17-20 above. The Visa Defendants and the MasterCard Defendants also shall identify and provide Class Counsel and the Class Administrator with the data used to make, and sufficient to analyze and evaluate, those calculations. It is intended for the Class Exclusion Takedown Payments to account fully for all the Opt Outs to the extent possible, but Opt Out data that cannot be determined or estimated in any reasonable manner shall not be included for the purposes of calculating the Class Exclusion Takedown Payments under Paragraphs 18(a) or 19(a) above.

(b) Class Counsel may, at its option, request that the Class Administrator provide, within fifteen days after receiving the report of the Visa Defendants and the MasterCard Defendants, an analysis and evaluation of the report of the Visa Defendants and the MasterCard Defendants, including all of its assumptions, data sources, and conclusions, and/or request that the Class Administrator prepare an independent report calculating the amount of the Class Exclusion Takedown Payments that should be made to the Visa Defendants and to the MasterCard Defendants.

(c) In the event that within thirty days after receiving the report of the Visa Defendants and the MasterCard Defendants — i.e., within approximately two hundred forty days after the Court’s entry of the Class Settlement Preliminary Approval Order — the Class Plaintiffs and the Defendants have not resolved all differences regarding the amount of the Class Exclusion

 

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Takedown Payments to be made to the Visa Defendants and the MasterCard Defendants, they shall submit their dispute to the Court for resolution in connection with the final approval hearing, so that the Court’s Class Settlement Order and Final Judgment may identify each Opt Out and state the Class Exclusion Takedown Payments to be made, respectively, to the Visa Defendants and to the MasterCard Defendants from the Class Settlement Cash Escrow Account(s) as provided in Paragraphs 17-20 above.

91. The Class Administrator’s expenses for the foregoing notice and exclusion activities, including those of any third-party vendors it uses to perform tasks necessary for the implementation or effectuation of its duties, shall be paid from the Class Settlement Cash Escrow Account(s). In no event shall any Defendant, Rule 23(b)(3) Settlement Class Released Party, or Rule 23(b)(2) Settlement Class Released Party have any obligation, responsibility, or liability with respect to the Class Administrator, the Notice Plan, or the exclusion procedures for members of the Rule 23(b)(3) Settlement Class, including with respect to the costs, administration expenses, or any other charges for any notice and exclusion procedures.

92. Class Counsel may, upon notice to the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class in the manner approved by the Court, seek Attorneys’ Fee Awards and Expense Awards. Class Counsel intend to apply for an Attorneys’ Fee Award in an amount that is a reasonable percentage of the Total Cash Payment Amount and for Expense Awards comprising all reasonable expenses and costs incurred, which requested amounts will be disclosed in the mail, publication, and other notices provided to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class. Class Counsel reserve the right to make additional applications for Attorneys’ Fee Awards and Expense Awards for fees and expenses incurred after the Preliminary Approval Date, including for achieving the Settlement Final Approval Date and Settlement Final Date, and for the administration of this Class

 

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Settlement Agreement. Class Counsel shall allocate any Attorneys’ Fee Awards and Expense Awards among counsel for the Class Plaintiffs and counsel for other plaintiffs in the Class Actions in a manner which they in good faith believe reflects the contribution of those counsel to the prosecution and settlement of the Class Actions in this Action.

93. The Court may consider any applications for Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards separately from a motion for preliminary or final approval of this Class Settlement Agreement, and may enter orders regarding such applications separately from the Class Settlement Order and Final Judgment. Any rehearing, reconsideration, vacation, review, appeal, or any other action taken regarding only a separate order concerning only an application for Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards, and not in any way concerning the Class Settlement Order and Final Judgment, shall not delay the Settlement Final Date that otherwise would occur with respect to the Class Settlement Order and Final Judgment.

Final Court Approval

94. Upon the Court’s entry of the Class Settlement Preliminary Approval Order, the Class Plaintiffs, Class Counsel, and the Defendants agree to use reasonable and good faith efforts to effectuate the Court’s final approval of this Class Settlement Agreement, including filing the necessary motion papers and scheduling any necessary hearings for a date and time that are convenient for the Court.

95. Separately from any motions for Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards, the Class Plaintiffs agree to file with the Court a motion and supporting papers seeking final approval of this Class Settlement Agreement, after providing Defendants with at least ten days advance notice of the contents of those papers, and to seek the Court’s

 

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entry of the Class Settlement Order and Final Judgment in the form in Appendix G hereto, which will:

(a) Determine that the Court has jurisdiction over the Class Plaintiffs, all members of the Rule 23(b)(3) Settlement Class, all members of the Rule 23(b)(2) Settlement Class, and the Defendants, and jurisdiction to finally approve this Class Settlement Agreement.

(b) Approve the notice and exclusion procedures provided to the Rule 23(b)(3) Settlement Class, and the notice procedures provided to the Rule 23(b)(2) Settlement Class, as fair, adequate, and sufficient, as the best practicable notice under the circumstances, and as reasonably calculated to apprise members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class of the Action, this Class Settlement Agreement, and their objection rights, and to apprise members of the Rule 23(b)(3) Settlement Class of their exclusion rights, and as fully satisfying the requirements of Federal Rule of Civil Procedure 23, any other applicable laws or rules of the Court, and due process.

(c) Finally approve this Class Settlement Agreement, including its consideration and release provisions, and find that the Class Settlement Agreement was made in good faith, following arm’s-length negotiations, and was not collusive, and further find that the Class Settlement Agreement is fair, reasonable, and adequate for the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, and consistent with the requirements of federal law and all applicable court rules, including Federal Rule of Civil Procedure 23.

(d) Finally certify the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, both as defined in Paragraph 2 above, for settlement purposes only, and declare that in the event of termination of this Class Settlement Agreement, certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class shall automatically be vacated

 

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and each Defendant may fully contest certification of any class as if no Rule 23(b)(3) Settlement Class or Rule 23(b)(2) Settlement Class had been certified.

(e) List all Opt Outs that timely and properly excluded themselves from the Rule 23(b)(3) Settlement Class, and state the agreed-upon or Court-resolved Class Exclusion Takedown Payments to be made, respectively, to the Visa Defendants and to the MasterCard Defendants from the Class Settlement Cash Escrow Account(s).

(f) Certify that the notification requirements of the Class Action Fairness Act, 28 U.S.C. § 1715, have been met.

(g) Approve the plan for the submission, processing, and allocation of claims to be made for members of the Rule 23(b)(3) Settlement Class with respect to the Net Cash Settlement Fund and the Net Interchange Settlement Fund.

(h) Order that the Class Plaintiffs and Class Counsel shall provide to the Visa Defendants and the MasterCard Defendants such information as they may reasonably request, as needed in connection with litigation, regarding the claims made by, and payments made to, members of the Rule 23(b)(3) Settlement Class from the Class Settlement Cash Escrow Account(s), which information may be produced subject to the terms of the protective order in this Action.

(i) Incorporate all terms and conditions of this Class Settlement Agreement by reference, state the settlement consideration and full terms of the release and covenant not to sue of the Rule 23(b)(3) Settlement Class, state the full terms of the release and covenant not to sue of the Rule 23(b)(2) Settlement Class, provide that each Rule 23(b)(3) Settlement Class Releasing Party unconditionally, fully, and finally releases and forever discharges each of the Rule 23(b)(3) Settlement Class Released Parties from all released claims and waives any rights of Rule 23(b)(3) Settlement Class members to the protections afforded under California Civil

 

88


Code § 1542 and/or any other similar, comparable, or equivalent laws, and provide that each Rule 23(b)(2) Settlement Class Releasing Party unconditionally, fully, and finally releases and forever discharges each of the Rule 23(b)(2) Settlement Class Released Parties from all released claims and waives any rights of Rule 23(b)(2) Settlement Class members to the protections afforded under California Civil Code § 1542 and/or any other similar, comparable, or equivalent laws.

(j) Enjoin all members of the Rule 23(b)(3) Settlement Class, and those subject to their control, from commencing, maintaining, or participating in, or permitting another to commence, maintain, or participate in on its behalf, any claims released against Rule 23(b)(3) Settlement Class Released Parties, and enjoin all members of the Rule 23(b)(2) Settlement Class, and those subject to their control, from commencing, maintaining, or participating in, or permitting another to commence, maintain, or participate on its behalf, any in any claims released against Rule 23(b)(2) Settlement Class Released Parties.

(k) Provide that the Court retains exclusive continuing jurisdiction in MDL 1720 over the Class Plaintiffs, the members of the Rule 23(b)(3) Settlement Class, the members of the Rule 23(b)(2) Settlement Class, and the Defendants to implement, administer, consummate, and enforce this Class Settlement Agreement and the Class Settlement Order and Final Judgment, including any disputes relating to, or arising out of, the release and covenant not to sue of the Rule 23(b)(3) Settlement Class or any claim for payment from the Class Settlement Cash Escrow Account(s) or the Class Settlement Interchange Escrow Account(s), and including any disputes relating to, or arising out of, the release and covenant not to sue of the Rule 23(b)(2) Settlement Class or any claim concerning any by-law, rule, operating regulation, practice, policy, or procedure of any Visa Defendant or MasterCard Defendant.

 

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(l) Direct that, as to the Defendants, all putative class actions consolidated in MDL 1720, listed in Appendix A hereto, be dismissed with prejudice and without costs (except as provided for herein).

(m) Determine that there is no just reason for delay in entering the final judgment, and direct that the Class Settlement Order and Final Judgment shall be final and appealable.

Termination

96. In the event that (a) any condition for the Settlement Preliminary Approval Date is not satisfied, (b) the Class Administrator fails to provide its report described in Paragraph 89 above by the date specified in Paragraph 89 or by such other date ordered by the Court, or (c) any condition for the Settlement Final Approval Date is not satisfied, Class Plaintiffs as a group or Defendants as a group may terminate this Class Settlement Agreement.

97. Defendants as a group may terminate this Class Settlement Agreement by providing written notice to the other parties and the Court within ten business days after determining that the sum of the Class Exclusion Takedown Payments calculated under Paragraphs 18 and 19 above, without regard to Paragraph 20 above, would exceed twenty-five percent of the Total Cash Payment Amount.

98. Class Plaintiffs as group or Defendants as a group, after conferring with the other group, may unilaterally terminate this Class Settlement Agreement by providing written notice to the other parties and the Court within twenty business days in the event that the Settlement Preliminary Approval Order, or the Court’s Class Settlement Order and Final Judgment are materially modified or not fully affirmed on any appeal or otherwise, including but not limited to any modification of certification for the purposes of settlement of the Rule 23(b)(3) Settlement Class, and the Rule 23(b)(2) Settlement Class (from which exclusions are not permitted), and

 

90


including but not limited to any modification of the releases and covenants not to sue provided by those settlement classes. Class Plaintiffs and Defendants agree to confer in good faith about whether to modify the twenty business day period provided in this Paragraph based on the circumstances.

99. In the event that this Class Settlement Agreement is terminated pursuant to Paragraphs 96-98 above:

(a) two-thirds of any sums in the Class Settlement Cash Escrow Account(s), less any Taxes due and Settlement Administration Costs approved by the Court and already paid or incurred, shall promptly be paid to an account that the Visa Defendants shall designate, and one-third of any sums in the Class Settlement Cash Escrow Account(s), less any Taxes due Settlement Administration Costs approved by the Court and already paid or incurred, shall promptly be paid to an account that the MasterCard Defendants shall designate;

(b) any sums in or to be paid into the Class Settlement Interchange Escrow Account(s) shall remain in those Escrow Account(s), and shall be distributed in the manner determined by the Court, if the parties do not enter into a new Class Settlement Agreement addressing such distribution.

(c) the Visa Defendants shall no longer be obligated to comply with Paragraphs 40-44 above, and the MasterCard Defendants shall no longer be obligated to comply with Paragraphs 53-57 above.

(d) any certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class by the Court will automatically be vacated, Defendants will retain all defenses to class certification, and Defendants’ non-opposition to the certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class for settlement purposes only

 

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shall not be used as evidence, and shall not be admissible as such, in support of or in opposition to class certification in the Action or any other civil action or other proceeding;

(e) the terms and conditions of this Class Settlement Agreement, any publicly disseminated information regarding this Class Settlement Agreement, and any orders, motion filings, objections, or oral argument concerning this Class Settlement Agreement, including any motion papers with respect to motions for preliminary or final approval of this Class Settlement Agreement, or for Attorneys’ Fee Awards or Expense Awards or Class Plaintiffs’ Awards, may not thereafter be used as evidence, and shall not be admissible as such, in the Action or any other civil action or other proceeding; and

(f) with the exception of Paragraphs 6-8, 11, 91, 99(a)-(e) above and Paragraphs 108-110 below, this Class Settlement Agreement including all its releases and covenants not to sue shall be null and void, and of no force and effect, and the Class Plaintiffs and the Defendants shall revert to their positions before the execution of this Class Settlement Agreement, including with respect to the appropriateness of class certification, as if this Class Settlement Agreement had not been reached or executed.

Continuing Jurisdiction

100. The Court will retain continuing jurisdiction over the Class Plaintiffs, the members of the Rule 23(b)(3) Settlement Class, the members of the Rule 23(b)(2) Settlement Class, and the Defendants to implement, administer, consummate, and enforce this Class Settlement Agreement and the Class Settlement Order and Final Judgment.

101. The Defendants and the Class Plaintiffs agree, and the members of the Rule 23(b)(3) Settlement Class and the members of the Rule 23(b)(2) Settlement Class will be deemed to have agreed, to submit irrevocably to the exclusive jurisdiction of the United States District Court for the Eastern District of New York for the resolution of any matter covered by this Class

 

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Settlement Agreement, the Class Settlement Order and Final Judgment, or the applicability of this Class Settlement Agreement or the Class Settlement Order and Final Judgment.

102. All applications to the Court with respect to any aspect of this Class Settlement Agreement or the Class Settlement Order and Final Judgment shall be presented to and be determined by United States District Court Judge John Gleeson for resolution as a matter within the scope of MDL 1720, or, if he is not available, any other District Court Judge designated by the Court. Without limiting the generality of the foregoing, it is hereby agreed that any suit, action, proceeding, or dispute of a Class Plaintiff or member of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, in which the provisions of this Class Settlement Agreement or the Class Settlement Order and Final Judgment are asserted as a ground for a defense, in whole or in part, to any claim or cause of action, or are otherwise raised as an objection, constitutes a suit, action, proceeding, or dispute arising out of or relating to this Class Settlement Agreement or the Class Settlement Order and Final Judgment.

103. In the event that the provisions of this Class Settlement Agreement or the Class Settlement Order and Final Judgment are asserted by any Defendant or Rule 23(b)(2) or Rule 23(b)(3) Settlement Class Released Party as a ground for a defense, in whole or in part, to any claim or cause of action, or are otherwise raised as an objection in any other suit, action, or proceeding by a Class Plaintiff or member of the Rule 23(b)(2) or Rule 23(b)(3) Settlement Class, it is hereby agreed that the Rule 23(b)(2) and Rule 23(b)(3) Settlement Class Released Parties shall be entitled to an immediate stay of that suit, action, or proceeding until after the Court has entered an order or judgment determining any issues relating to the defense or objections based on such provisions, and no further judicial review of such order or judgment is possible.

 

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Additional Terms and Conditions

104. Without expanding or limiting the release it provides herein, each Rule 23(b)(3) Settlement Class Releasing Party shall be deemed to have agreed that this Class Settlement Agreement fully addresses and redresses any and all antitrust or other competitive issues presented by the Visa Defendants’ and the MasterCard Defendants’ respective payment networks in the United States, and the Bank Defendants’ participation in those respective payment networks, including any reorganization, restructuring, initial or other public offering, or other corporate structuring of any Visa Defendant or MasterCard Defendant.

105. The Class Plaintiffs, Class Counsel, Class Plaintiffs’ other counsel who have participated in any settlement conferences before the Court for a Class Plaintiff that executes this Class Settlement Agreement, Defendants, and counsel for the Defendants, agree that they:

(a) Shall not in any way encourage, promote, or solicit any person, business, or entity within the definition of the Rule 23(b)(3) Settlement Class, or their counsel, to request exclusion from the Rule 23(b)(3) Settlement Class, to object to this Class Settlement Agreement, or to seek any relief inconsistent with this Class Settlement Agreement.

(b) Shall not in any way encourage, promote, or solicit any person, business, or entity within the definition of the Rule 23(b)(2) Settlement Class, or their counsel, to object to this Class Settlement Agreement or to seek any relief inconsistent with this Class Settlement Agreement.

(c) Shall not in any way encourage, promote, or solicit any person, business, or entity within the definition of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, or their counsel, to facilitate, induce, or cause the non-fulfillment of a condition, or the occurrence of an event, that could result in the termination of this Class Settlement Agreement.

 

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106. The Class Plaintiffs, Class Counsel, and the Defendants shall undertake reasonable efforts to timely obtain any required approvals or consents to execute and proceed with this Class Settlement Agreement.

107. The Class Plaintiffs, Class Counsel, and the Defendants shall execute all documents and perform any additional acts reasonably necessary and proper to effectuate the terms of this Class Settlement Agreement.

108. The terms and provisions of the Fourth Amended Protective Order, filed on October 29, 2009, and approved by the Court on October 30, 2009, shall survive and continue in effect through and after any final adjudication of the Class Actions.

109. Each of the Defendants specifically denies any and all liability in this Action. It is expressly understood and agreed that, by entering into this Class Settlement Agreement, each Defendant, each Rule 23(b)(3) Settlement Class Released Party, and each Rule 23(b)(2) Settlement Class Released Party is not admitting any liability or wrongdoing whatsoever to the Class Plaintiffs, any member of the Rule 23(b)(3) Settlement Class, any member of the Rule 23(b)(2) Settlement Class, or any other person or entity, and is not admitting the truth of any allegations or circumstances, nor is any Defendant, Rule 23(b)(3) Settlement Class Released Party, or Rule 23(b)(2) Settlement Class Released Party waiving any defense.

110. This Class Settlement Agreement, and all negotiations, documents, and discussions associated with it, shall be without prejudice to the rights, positions, or privileges of any Class Plaintiff or Defendant or other Rule 23(b)(3) Settlement Class Released Party or Rule 23(b)(2) Settlement Class Released Party (except as expressly provided for in this Class Settlement Agreement), and shall not be construed as, or deemed to be, an admission or evidence on the part of any Defendant or other Rule 23(b)(3) Settlement Class Released Party or Rule 23(b)(2) Settlement Class Released Party of any violation of any statute, regulation, law, rule, or

 

95


principle of common law or equity, or of any liability or wrongdoing, or of the truth or merit of any allegations or claims in this Action, and shall not be discoverable, used, offered, or accepted, directly or indirectly, as evidence of such in this Action or any other action, litigation, arbitration, or other proceeding, and shall have no precedential value; provided, however, that nothing contained herein shall preclude use of this Class Settlement Agreement in any proceeding to enforce this Class Settlement Agreement or the Class Settlement Order and Final Judgment.

111. Nothing in this Class Settlement Agreement is intended to waive any right to assert that any information or material is protected from discovery by reason of any individual or common interest privilege, attorney-client privilege, work product protection, or other privilege, protection, or immunity, or is intended to waive any right to contest any such claim of privilege, protection, or immunity.

112. This Class Settlement Agreement constitutes the entire, complete, and integrated agreement between and among the Class Plaintiffs, on behalf of themselves and the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, and the Defendants with respect to the settlement of the Class Actions. All of the Appendices to this Class Settlement Agreement are material and integral parts of it and are incorporated by reference as if fully set forth herein.

113. The terms of this Class Settlement Agreement are not severable, but are interdependent and have been agreed to only as a whole by the Class Plaintiffs, Class Counsel, and the Defendants.

114. This Class Settlement Agreement supersedes all prior negotiations and agreements, and is not subject to any condition not provided for in this Class Settlement Agreement. In entering into and executing this Class Settlement Agreement, the Class Plaintiffs

 

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and the Defendants warrant that they are acting upon their respective independent judgments and upon the advice of their respective counsel, and not in reliance upon any warranty or representation, express or implied, of any nature or kind by any other person or entity, other than the warranties and representations expressly made in this Class Settlement Agreement.

115. This Class Settlement Agreement shall be governed, construed, enforced, and administered in accordance with the laws of the State of New York without reference to its conflict of laws principles.

116. This Class Settlement Agreement may not be modified or amended except (a) by a writing signed by the Class Plaintiffs and the Defendants or their respective counsel and approved by the Court, or (b) by motion to the Court by a Class Plaintiff or Defendant based on changed circumstances that would make continued application of Paragraphs 42 or 55 above inequitable.

117. This Class Settlement Agreement or any portion thereof shall not be construed more strictly against any party to it merely because it may have been prepared by counsel for one of them, it being recognized that because of the arm’s-length negotiations resulting in this Class Settlement Agreement, all parties to this Class Settlement Agreement have contributed substantially and materially to the preparation of it.

118. All headings used in this Class Settlement Agreement are for reference and convenience only and shall not affect the meaning or interpretation of this Class Settlement Agreement.

119. The waiver by any Class Plaintiff or Defendant of any breach of this Class Settlement Agreement shall not be deemed or construed as a waiver of any other breach of this Class Settlement Agreement, whether prior, subsequent, or contemporaneous.

 

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120. This Class Settlement Agreement shall be binding upon, and shall inure to the benefit of, the Class Plaintiffs, the members of the Rule 23(b)(3) Settlement Class, the members of the Rule 23(b)(2) Settlement Class, and the Defendants. The Rule 23(b)(3) Settlement Class Released Parties and the Rule 23(b)(2) Settlement Class Released Parties, other than the Defendants, are third party beneficiaries of this Class Settlement Agreement and are authorized to enforce the provisions of this Class Settlement Agreement, including without limitation the release and covenant not to sue provisions in Paragraphs 31-38 and Paragraphs 66-74 above, the continuing jurisdiction provisions in Paragraphs 100-103 above, and such other provisions of this Class Plaintiffs’ Settlement Agreement as are applicable to them.

121. Any notice or materials to be provided to the Class Plaintiffs pursuant to this Class Settlement Agreement shall be sent to Class Counsel, and any notice or materials to be provided to the Defendants pursuant to this Class Settlement Agreement shall be sent to their respective counsel in MDL 1720, whose names and contact information are set forth in Appendix H hereto. Any notice or materials to be submitted to the Court pursuant to this Class Settlement Agreement shall also be filed in MDL 1720 through the Electronic Court Filing (ECF) system of the Court.

122. Each of the undersigned representatives of each Class Plaintiff and each Defendant represents that it is fully authorized to enter into, and to execute, this Class Settlement Agreement on behalf of that Class Plaintiff or Defendant. Each of the Class Plaintiffs and the Defendants agrees that, in return for the agreements in this Class Settlement Agreement, it is receiving good and valuable consideration, the receipt and sufficiency whereof is hereby acknowledged.

123. This Class Settlement Agreement may be executed in counterparts, each of which shall be deemed to be an original, and all of which together shall constitute one and the same

 

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instrument. The Class Settlement Agreement shall become effective only when executed by all of the Class Plaintiffs, Class Counsel, and Defendants listed below, and approved by the requisite vote of the members of Visa U.S.A. Inc. entitled to vote thereon.

IN WITNESS WHEREOF, the signatories below have read and understood this Class Settlement Agreement, have executed it, represent that the undersigned are authorized to execute this Class Settlement Agreement on behalf of their respectively represented parties, have agreed to be bound by its terms, and have duly executed this Class Settlement Agreement.

 

    FOR CLASS PLAINTIFF
    PHOTOS ETC. CORPORATION
Dated: October 19, 2012     By:  

/s/ Mitch Goldstone

      Mitch Goldstone
      President and CEO
    FOR CLASS PLAINTIFF
    TRADITIONS, LTD.
Dated: October 19, 2012     By:  

/s/ Michael Schumann

      Michael Schumann
      Co-Owner, Secretary/Treasurer
    FOR CLASS PLAINTIFF
    CHS INC.
Dated: October 19, 2012     By:  

/s/ Doug R. Dorfman

      Doug R. Dorfman
      Vice President – Refined Fuels Marketing

 

99


    FOR CLASS PLAINTIFF
    PARKWAY CORP.
Dated: October 19, 2012     By:  

/s/ Robert Zuritsky

      Robert Zuritsky
      President
    FOR CLASS PLAINTIFF
    DISCOUNT OPTICS, INC.
Dated: October 19, 2012     By:  

/s/ Deborah E. Opper

      Deborah E. Opper
      Executive Vice President
    FOR CLASS PLAINTIFF
    CRYSTAL ROCK LLC
Dated: October 19, 2012     By:  

/s/ Peter Baker

      Peter Baker
      Manager
    FOR CLASS PLAINTIFF
    LEON’S TRANSMISSION SERVICE, INC.
Dated: October 19, 2012     By:  

/s/ Henry Springer

      Henry Springer
      President
    FOR CLASS PLAINTIFF
    PAYLESS SHOESOURCE, INC.
Dated: October 19, 2012     By:  

/s/ Miguel R. Rivera, Sr.

      Miguel R. Rivera, Sr.
      VP – Deputy General Counsel
      Collective Brands, Inc.

 

100


    FOR CLASS PLAINTIFF
    CAPITAL AUDIO ELECTRONICS, INC.
Dated: October 19, 2012     By:  

/s/ Abraham Harari

      Abraham Harari
      President
    FOR DEFENDANTS
    VISA INC., VISA U.S.A. INC., AND VISA
    INTERNATIONAL SERVICE ASSOCIATION
Dated: October 19, 2012     By:  

/s/ Joshua Floum

      Joshua Floum
      General Counsel
    FOR DEFENDANTS
    MASTERCARD INTERNATIONAL
    INCORPORATED AND MASTERCARD
    INCORPORATED
Dated: October 19, 2012     By:  

/s/ Noah Hanft

      Noah Hanft
      General Counsel and Chief Franchise
      Integrity Officer
    FOR DEFENDANTS
    BANK OF AMERICA, N.A. AND BANK OF AMERICA CORPORATION
Dated: October 19, 2012     By:  

/s/ David C. Darnell

      David C. Darnell
      Co-Chief Operating Officer

 

101


    FOR DEFENDANTS
    BA MERCHANT SERVICES LLC, FORMERLY KNOWN AS NATIONAL PROCESSING, INC.)
Dated: October 19, 2012     By:  

/s/ JoAnn P. Carlton

      JoAnn P. Carlton
      Executive Vice President, General
      Counsel
    FOR DEFENDANT
    FIA CARD SERVICES, N.A., FORMERLY KNOWN AS MBNA AMERICA BANK, N.A. AND BANK OF AMERICA, N.A. (USA)
Dated: October 19, 2012     By:  

/s/ Susan R. Faulkner

      Susan R. Faulkner
      Senior Vice President, Consumer &
      Small Business Product Executive
    FOR DEFENDANTS
    BARCLAYS BANK DELAWARE AND BARCLAYS BANK PLC (IN ITS INDIVIDUAL CAPACITY AND AS SUCCESSOR IN INTEREST TO BARCLAYS FINANCIAL CORP.)
Dated: October 19, 2012     By:  

/s/ Clinton Walker

      Clinton Walker
      Secretary and General Counsel
      Barclays Bank Delaware

 

102


    FOR DEFENDANTS
    CAPITAL ONE BANK (USA), N.A., CAPITAL ONE, N.A. (AS SUCCESSOR TO CAPITAL ONE F.S.B.), AND CAPITAL ONE FINANCIAL CORPORATION
Dated: October 19, 2012     By:  

/s/ John G. Finneran, Jr.

      John G. Finneran, Jr.
      General Counsel
    FOR DEFENDANTS
    CHASE BANK USA, N.A., CHASE MANHATTAN BANK USA, N.A., JPMORGAN CHASE BANK, N.A., JPMORGAN CHASE & CO., BANK ONE CORPORATION, AND BANK ONE DELAWARE, N.A.
Dated: October 19, 2012     By:  

/s/ Gordon A. Smith

      Gordon A. Smith
      Co-CEO Chase Consumer and Community
      Banking
    FOR DEFENDANT
    CHASE PAYMENTECH SOLUTIONS, LLC
Dated: October 19, 2012     By:  

/s/ Daniel J. Charron

      Daniel J. Charron
      Executive Vice President
    FOR DEFENDANT
    CITIGROUP INC.
Dated: October 19, 2012     By:  

/s/ Rohan Weerasinghe

      Rohan Weerasinghe
      General Counsel and Corporate Secretary

 

103


    FOR DEFENDANT
    CITICORP
Dated: October 19, 2012     By:  

/s/ Anita Romero

      Anita Romero
      General Counsel and Secretary
    FOR DEFENDANT
    CITIBANK, N.A., ON BEHALF OF ITSELF
    AND AS SUCCESSOR IN INTEREST TO
    CITIBANK (SOUTH DAKOTA), N.A.
Dated: October 19, 2012     By:  

/s/ Anita Romero

      Anita Romero
      General Counsel and Secretary
    FOR DEFENDANT
    FIFTH THIRD BANCORP
Dated: October 19, 2012     By:  

/s/ James R. Hubbard

      James R. Hubbard
      Senior Vice President and Chief Legal
      Officer
    FOR DEFENDANT
    FIRST NATIONAL BANK OF OMAHA
Dated October 19, 2012     By:  

/s/ Nicholas W. Baxter

      Nicholas W. Baxter
      Senior Vice President
    FOR DEFENDANT
    HSBC FINANCE CORPORATION
Dated: October 19, 2012     By:  

/s/ Patrick J. Burke

      Patrick J. Burke
      Chief Executive Officer

 

104


    FOR DEFENDANT
    HSBC BANK USA, N.A.
Dated: October 19, 2012     By:  

/s/ Mark L. LoSocco

      Mark L. LoSocco
      Executive Vice President and General
      Counsel, Litigation and Employment &
      Benefits Law
    FOR DEFENDANT
    HSBC NORTH AMERICA HOLDINGS INC.
Dated: October 19, 2012     By:  

/s/ Eric K. Ferren

      Eric K. Ferren
      Chief Accounting Officer
    FOR DEFENDANT
    HSBC HOLDINGS PLC
Dated: October 19, 2012     By:  

/s/ Stuart A. Levey

      Stuart A. Levey
      Chief Legal Officer
    FOR DEFENDANT
    HSBC BANK PLC
Dated: October 19, 2012     By:  

/s/ Richard J.H. Gray

      Richard J.H. Gray
      Regional General Counsel, Europe and
      Global Businesses

 

105


    FOR DEFENDANT
    THE PNC FINANCIAL SERVICES GROUP, INC, SUCCESSOR BY MERGER TO NATIONAL CITY CORPORATION
Dated: October 19, 2012     By:  

/s/ Joseph C. Guyaux

      Joseph C. Guyaux
      Senior Vice Chairman
    FOR DEFENDANT
    PNC BANK, NATIONAL ASSOCIATION, SUCCESSOR BY MERGER TO NATIONAL CITY BANK AND NATIONAL CITY BANK OF KENTUCKY
Dated: October 19, 2012     By:  

/s/ Joseph C. Guyaux

      Joseph C. Guyaux
      Senior Vice Chairman
    FOR DEFENDANT
    TEXAS INDEPENDENT BANCSHARES, INC.
Dated: October 19, 2012     By:  

/s/ Charles T. Doyle

      Charles T. Doyle
      Chairman
    FOR DEFENDANTS
    SUNTRUST BANKS, INC. AND SUNTRUST BANK
Dated: October 19, 2012     By:  

/s/ Brian D. Edwards

      Brian D. Edwards
      Deputy General Counsel

 

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    FOR DEFENDANT
    WELLS FARGO BANK, N.A., FOR ITSELF AND AS SUCCESSOR TO WACHOVIA BANK, N.A.
Dated: October 19, 2012     By:  

/s/ Avid Modjtabai

      Avid Modjtabai
      Senior Executive Vice President
    FOR DEFENDANT
    WELLS FARGO & COMPANY, FOR ITSELF AND AS SUCCESSOR TO WACHOVIA CORPORATION
Dated: October 19, 2012     By:  

/s/ Avid Modjtabai

      Avid Modjtabai
      Senior Executive Vice President

 

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    FOR CLASS COUNSEL
Dated: October 19, 2012     By:  

/s/ H. Laddie Montague, Jr.

      H. Laddie Montague, Jr.
      Berger & Montague, P.C.
Dated: October 19, 2012     By:  

/s/ K. Craig Wildfang

      K. Craig Wildfang
      Robins, Kaplan, Miller & Ciresi L.L.P.
Dated: October 19, 2012     By:  

/s/ Bonny E. Sweeney

      Bonny E. Sweeney
      Robbins Geller Rudman & Dowd LLP

 

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APPENDIX A — Class Actions in MDL 1720

47 West 55th Restaurant Inc. v. Visa U.S.A. Inc., et al., No. 06-CV-01829-JG-JO (E.D.N.Y.), formerly No. 05-CV-08057-SCR (S.D.N.Y).

518 Restaurant Corp. v. American Express Travel Related Services Co., Inc., et al., No. 05-CV-05884-JG-JO (E.D.N.Y.), formerly No. 05-CVG-04230-GP (E.D. Pa.).

American Booksellers Association v. Visa U.S.A., Inc., et al., No. 05-CV-05319-JG-JO (E.D.N.Y.).

Animal Land, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05074-JG-JO (E.D.N.Y.), formerly No. 05-CV-01210-JOF (N.D. Ga.).

Baltimore Avenue Foods, LLC v. Visa U.S.A., Inc., et al., No. 05-CV-05080-JG-JO (E.D.N.Y.), formerly No. 05-CV-06532-DAB (S.D.N.Y).

Bishara v. Visa USA, Inc, et al., No. 05-CV-05883-JG-JO (E.D.N.Y.), formerly No. 05-CV-04147-GP (E.D. Pa.).

BKS, Inc., et al. v. Visa, Inc, et al., No. 09-CV-02264-JG-JO (E.D.N.Y.), formerly No. 09-CV-00066-KS-MTP (S.D. Miss.).

Bonte Wafflerie, LLC, et al. v. Visa U.S.A., Inc., et al., No. 05-CV-05083-JG-JO (E.D.N.Y.), formerly No. 05-CV-06708-DAB (S.D.N.Y).

Broken Ground, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05082-JG-JO (E.D.N.Y.), formerly No. 05-CV-06543-DAB (S.D.N.Y).

Connecticut Food Association, Inc., et al. v. Visa U.S.A., Inc., et al., No. 05-CV-05880-JG-JO (E.D.N.Y.), formerly No. 05-CV-07456-DAB (S.D.N.Y).

Discount Optics, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05870-JG-JO (E.D.N.Y.), formerly No. 05-CV-07175-DAB (S.D.N.Y).

East Goshen Pharmacy, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05073-JG-JO (E.D.N.Y.), formerly No. 05-CV-01177-JBA (D. Conn.).

Esdacy, Inc. v. Visa U.S.A., Inc. et al., No. 06-CV-05583-JG-JO (E.D.N.Y.), formerly No. 06-CV-02192-MDL (D. S.C.).

Fairmont Orthopedics & Sports Medicine, PA, et al. v. Visa U.S.A., Inc., et al., No. 05-CV-05076-JG-JO (E.D.N.Y.), formerly No. 05-CV-06259-DAB (S.D.N.Y).

Fitlife Health Systems of Arcadia, Inc. v. Mastercard International Incorporated, et al., No. 05-CV-05153-JG-JO (E.D.N.Y.).

 

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Fringe, Inc. v. Visa U.S.A., Inc. et al., No. 05-CV-04194-JG-JO (E.D.N.Y.).

G.E.S. Bakery, Inc. v. Visa USA, Inc, et al., No. 05-CV-05879-JG-JO (E.D.N.Y.), formerly No. 05-CV-07414-DAB (S.D.N.Y).

Gulfside Casino Partnership v. Visa, Inc., et al., No. 09-CV-03225-JG-JO (E.D.N.Y.), formerly No 05-CV-00382-HSO-JMR (S.D. Miss.).

Harris Stationers, Inc., et al. v. VISA International Service Association, Inc., et al., No. 05-CV-05868-JG-JO (E.D.N.Y.), formerly No. 05-CV-06541-ABC-AJW (C.D. Cal.).

Hyman, et al. v. VISA International Service Association, Inc, et al., No. 05-CV-05866-JG-JO (E.D.N.Y.), formerly No. 05-CV-00487 (W.D. Ky.).

Jasperson v. Visa U.S.A., Inc., et al., No. 05-CV-05070-JG-JO (E.D.N.Y.), formerly No. 05-CV-02996-MMC (N.D. Cal.).

Jax Dux & Bux, LLC v. Visa U.S.A. Inc, et al., No. 06-CV-01830-JG-JO (E.D.N.Y.), formerly No. 05-CV-08058-SCR (S.D.N.Y).

Jetro Holding, Inc., et al. v. Visa U.S.A., Inc., et al., No. 05-CV-04520-JG-JO (E.D.N.Y.).

JGSA, Inc. v. Visa USA, Inc, et al., No. 05-CV-05885-JG-JO (E.D.N.Y.), formerly No. 05-CV-00801-CNC (E.D. Wis.).

Lakeshore Interiors v. Visa U.S.A., Inc., et al., No. 05-CV-05081-JG-JO (E.D.N.Y.), formerly No. 05-CV-06683-DAB (S.D.N.Y).

LDC, Inc. v. Visa USA, Inc, et al., No. 05-CV-05871-JG-JO (E.D.N.Y.), formerly No. 05-CV-07316-DAB (S.D.N.Y).

Lee, et. al. v. Visa U.S.A. Inc., et. al., No. 05-CV-03800-JG-JO (E.D.N.Y.).

Leeber Cohen, M.D. v. Visa U.S.A., Inc., et al., No. 05-CV-05878-JG-JO (E.D.N.Y.), formerly No. 05-CV-07317-DAB (S.D.N.Y).

Lepkowski v. Mastercard International Incorporated, et al., No. 05-CV-04974-JG-JO (E.D.N.Y.).

Lombardo Bros., Inc. v. Visa U.S.A., Inc., No. 05-CV-05882-JG-JO (E.D.N.Y.), formerly No. 05-CV-04146-GP (E.D. Pa.).

Michael Cetta, Inc. v. Visa U.S.A. Inc., et al., No. 06-CV-01831-JG-JO (E.D.N.Y.), formerly No. 05-CV-08060-SCR (S.D.N.Y).

 

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National Association of Convenience Stores, et al. v. Visa U.S.A., Inc. et al., No. 05-CV-04521-JG-JO (E.D.N.Y.).

National Grocers Association, et al. v. Visa U.S.A., Inc. et al., No. 05-CV-05207-JG-JO (E.D.N.Y.).

NuCity Publications, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05075-JG-JO (E.D.N.Y.), formerly No. 05-CV-05991-DAB (S.D.N.Y).

Parkway Corp., et al. v. Visa U.S.A., Inc, et al., No. 05-CV-05077-JG-JO (E.D.N.Y.), formerly No. 05-CV-06349-DAB (S.D.N.Y).

Payless Shoe Source, Inc. v. Visa U.S.A. Inc, et al., No. 06-CV-01832-JG-JO (E.D.N.Y.), formerly No. 05-CV-09245-SCR (S.D.N.Y).

Performance Labs, Inc. v. American Express Travel Related Services Co., Inc., et al., No. 05-CV-05869-JG-JO (E.D.N.Y.), formerly No. 05-CV-03959-JCL-MF (D. N.J.).

Photos Etc. Corp., et al. v. Visa U.S.A., Inc., et al., No. 05-CV-05071-JG-JO (E.D.N.Y.), formerly No. 05-CV-01007-WWE (D. Conn.).

Resnick Amsterdam & Leshner P.C. v. Visa U.S.A., Inc., et al., No. 05-CV-03924-JG-JO (E.D.N.Y.).

Rookies, Inc., et al. v. Visa U.S.A., Inc., et al., No. 05-CV-05069-JG-JO (E.D.N.Y.), formerly No. 05-CV-02933-SC (N.D. Cal.).

Seaway Gas & Petroleum, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-04728-JG-JO (E.D.N.Y.).

Tabu Salon & Spa, Inc. v. Visa U.S.A., Inc., et al., No. 05-CV-05072-JG-JO (E.D.N.Y.), formerly No. 05-CV-01111-WWE (D. Conn.).

Twisted Spoke v. Visa USA, Inc, et al., No. 05-CV-05881-JG-JO (E.D.N.Y.), formerly No. 05-CV-02108-KMO (N.D. Ohio).

 

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APPENDIX B — Class Settlement Cash Escrow Agreement

This Class Settlement Cash Escrow Agreement (“Escrow Agreement”) dated October 19, 2012, is made and entered into in connection with the concurrently executed Definitive Class Settlement Agreement (the “Class Settlement Agreement”) in the matter of In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, No. 05-MD-1720(JG)(JO) (“The Action”). This Escrow Agreement is entered into on behalf of the Class Plaintiffs, by and through Class Counsel; each of the Visa Defendants and the MasterCard Defendants, by and through their respective authorized signatories below; and The Huntington National Bank as escrow agent (the “Escrow Agent”) (collectively, the “Parties”).

Recitals

A. This Escrow Agreement governs the administration, maintenance, investment, and disbursement of the Total Cash Payment Amount of $6,050,000,000 to be deposited into the Cash Settlement Escrow Account(s) subject to the terms provided in the Class Settlement Agreement.

B. The Total Cash Payment Amount deposited into the Class Settlement Cash Escrow Account(s), together with any interest, dividends, and other distributions and payments accrued thereon, is to be used by the Escrow Agent solely in the manner provided in the Class Settlement Agreement and approved by the Court.

C. In no event shall the Visa Defendants or the MasterCard Defendants, any other Defendant, or any other Rule 23(b)(3) Settlement Class Released Party or Rule 23(b)(2) Settlement Class Released Party, except The Huntington National Bank to the extent of its obligations as Escrow Agent herein, have any obligation, responsibility, or liability arising from or relating to the administration, maintenance, preservation, investment, use, allocation, adjustment, distribution, disbursement, or disposition of any funds in the Class Settlement Cash Escrow Account(s).

D. Unless otherwise defined herein, all capitalized terms shall have the meaning ascribed to them in the Class Settlement Agreement, and the terms of the Class Settlement Agreement are hereby incorporated by reference into this Escrow Agreement.

Agreement

1. Appointment of Escrow Agent. The Escrow Agent is hereby appointed to establish the Class Settlement Cash Escrow Account(s) and to receive, deposit, administer, maintain, invest, and disburse the Total Cash Payment Amount upon the terms and conditions provided in this Escrow Agreement, the Class Settlement Agreement, and any other exhibits or schedules annexed hereto and made a part hereof.

2. Qualifications. The Escrow Agent and any bank at which the Escrow Agent maintains a Class Settlement Cash Escrow Account for the purposes of this Escrow Agreement shall at all times be a bank, savings and loan association, and/or trust company in good standing, organized and doing business under the laws of the United States or a State of the United States,

 

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having assets of not less than twenty-five billion dollars ($25,000,000,000). The Escrow Agent shall be authorized under such laws to enter into and perform this Escrow Agreement, and shall be unrelated to and independent of the Class Plaintiffs and the Defendants within the meaning of Treasury Regulations § 1.468B-1(d) and § 1.468B-3(c)(2)(A). If the Escrow Agent at any time ceases to have the foregoing qualifications, the Escrow Agent shall give notice of resignation to the other Parties and a qualified successor escrow agent shall be appointed in accordance with Section 14 of this Escrow Agreement.

3. The Escrow Account. The Escrow Agent shall establish, maintain, and receive and disburse funds from one or more escrow accounts titled as the Class Settlement Cash Escrow Account(s) at financial institutions (the “Custodian Banks”), into which the Total Cash Payment Amount shall be deposited subject to and in accordance with the terms of the Class Settlement Agreement. The Custodian Banks shall be The Huntington National Bank and U.S. Bank. The Escrow Agent shall provide the Parties with notice of the names and account numbers for those Class Settlement Cash Escrow Account(s), and with monthly account statements or reports that describe all deposits, investments, disbursements, and other activities with respect to funds in those Class Settlement Cash Escrow Account(s). The Class Settlement Cash Escrow Account(s) shall be segregated accounts held and invested on the terms and subject to the limitations set forth herein, and funds or financial assets contained therein shall be invested and disbursed by the Escrow Agent in accordance with the terms and conditions hereinafter set forth and set forth in the Class Settlement Agreement and in orders of the Court approving the disbursement of the funds or financial assets contained therein.

4. Investment of the Class Settlement Cash Escrow Account(s). The Escrow Agent shall invest all sums deposited into the Class Settlement Cash Escrow Account(s) exclusively in instruments backed by the full faith and credit of the United States Government or fully insured by the United States Government, including a U.S. Treasury Money Market Fund, with a term of investment of no more than twelve months, or a bank account insured by the Federal Deposit Insurance Corporation (“FDIC”) up to, but in no event in excess of, the maximum amount so insured. Amounts which may reasonably be expected to be disbursed in the forthcoming three months shall be invested in such instruments with a maturity not to exceed three months. The Escrow Agent shall reinvest the proceeds of these instruments as they mature in those same types of instruments at their then-current market rates. The Escrow Agent may, with reasonable notice to Class Counsel, sell or liquidate any of the foregoing investments at any time if the proceeds thereof are required for any disbursement of funds from the Class Settlement Cash Escrow Account(s) under this Escrow Agreement and the Class Settlement Agreement. Except as provided in the Class Settlement Agreement, all interest, dividends, and other distributions and payments in connection with the investment of the Class Settlement Cash Escrow Account(s) shall accrue to the benefit of the Class Settlement Cash Escrow Account(s). All losses, costs or penalties resulting from any sale or liquidation of the investments of the Class Settlement Cash Escrow Account(s) shall be charged against the Class Settlement Cash Escrow Account(s).

5. Escrow Funds Subject to Jurisdiction of the Court. The Class Settlement Cash Escrow Account(s) shall remain subject to the jurisdiction of the Court, and be under the continuing supervision of the Court, until such time as the funds contained therein are fully distributed pursuant to the Class Settlement Agreement and on further order(s) of the Court.

 

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6. Tax Treatment & Report. The Class Settlement Cash Escrow Account(s) shall be set up, maintained, and treated at all times as a “Qualified Settlement Fund” within the meaning of Treasury Regulation §1.468B-1 and any analogous local, state, and/or foreign statute, law, regulation, or rule. The Escrow Agent shall timely make such elections as necessary or advisable to fulfill the requirements of such Treasury Regulation, including the “relation-back election” under Treas. Reg. § 1.468B-1(j)(2) to the earliest permitted date. Such election shall be made in compliance with the procedures and requirements contained in the Treasury Regulations. For purposes of §468B of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, the “administrator” of the Class Settlement Cash Escrow Account(s) shall be the Escrow Agent. The Escrow Agent shall timely and properly prepare, deliver to all necessary parties for signature, and file all necessary documentation for any elections required under Treas. Reg. §1.468B-1. Escrow Agent shall timely and properly prepare and file any informational and other tax returns necessary or advisable with respect to the Class Settlement Cash Escrow Account(s) and the distributions and payments therefrom, including without limitation the returns described in Treasury Regulation §1.468B-2(k), and to the extent applicable Treasury Regulation §1.468B-2(1).

7. Tax Payments of Class Settlement Cash Escrow Account(s). All Taxes with respect to income earned on the Class Settlement Cash Escrow Account(s), as more fully described in the Class Settlement Agreement, shall be treated as and considered to be a cost of administration of the Settlement Fund and the Escrow Agent shall timely pay such Taxes out of the Class Settlement Cash Escrow Account(s), as appropriate, without prior order of the Court. The Escrow Agent shall be responsible for the timely and proper preparation and delivery of any necessary documentation for signature by all necessary parties, and the timely filing of all tax returns and other tax reports required by law, and the withholding of any taxes required by law; provided that the Escrow Agent shall have no 1099 reporting obligations with respect to any distribution, compensation, income or other benefits paid to Authorized Cash Claimants (which tax reporting duties shall be fulfilled by the Class Administrator). The Escrow Agent may engage an accounting firm or tax preparer to assist in the preparation of any tax reports or the calculation of any tax payments due as set forth in Sections 6 and 7, and the expense of such assistance shall be paid from the Class Settlement Cash Escrow Account(s). The Class Settlement Cash Escrow Account(s) shall indemnify and hold the Defendants harmless for any taxes that may be deemed to be payable by the Defendants by reason of the income earned on the Class Settlement Cash Escrow Account(s), and the Escrow Agent shall establish such reserves as are necessary to cover the tax liabilities of the Class Settlement Cash Escrow Account(s) and the indemnification obligations imposed by this Section. To the extent that any sums in Class Settlement Cash Escrow Account(s) are paid to any Defendant pursuant to the terms of the Class Settlement Agreement or this Escrow Agreement, the Escrow Agent may require such Defendant to provide wire payment information and forms or information necessary for tax purposes with respect to the payment.

8. Disbursement Instructions. Disbursements from the Class Settlement Cash Escrow Account(s) are to be made only in accordance with the terms and provisions contained in Paragraphs 16-24 of the Class Settlement Agreement, upon written authorization of Class Counsel and the Visa Defendants and the MasterCard Defendants, and include the following:

(a) Pursuant to Paragraph 16 of the Class Settlement Agreement, the Escrow Agent may make payments prior to the Settlement Final Approval Date only in the amounts approved by the Court and only to pay for (i) the costs of establishing, maintaining, or

 

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administering the Class Settlement Cash Escrow Account(s), including Taxes and the administrative costs of paying such Taxes; (ii) Settlement Administration Costs, including the costs of the Notice Plan and the exclusion procedures for Opt Outs as provided in Paragraphs 79-93 of the Class Settlement Agreement, and additional costs for claims administration, in amounts consistent with the limitations of Paragraph 21(c) of the Class Settlement Agreement.

(b) Pursuant to Paragraphs 17-20 of the Class Settlement Agreement, within ten business days after the Settlement Final Approval Date, the Escrow Agent shall make payments in amounts approved by the Court to pay for the Class Exclusion Takedown Payments described in Paragraphs 17-20 of the Class Settlement Agreement, as determined through the procedures described in Paragraph 90 of the Class Settlement Agreement

(c) Pursuant to Paragraphs 21-22 of the Class Settlement Agreement, from the Settlement Final Approval Date to the date twenty business days after the Settlement Final Date, and subject to making the Class Exclusion Takedown Payments provided in Paragraphs 17-20 of the Class Settlement Agreement, the Escrow Agent may make payments only in amounts approved by the Court for (i) the costs of maintaining or administering the Class Settlement Cash Escrow Account(s), including Taxes and the administrative costs of paying such Taxes, and (ii) Expense Awards and Settlement Administration Costs as described and limited in Paragraphs 21-22 of the Class Settlement Agreement.

(d) Pursuant to Paragraphs 23-24 of the Class Settlement Agreement, commencing the day after ten business days after the Settlement Final Date, if the Class Settlement Agreement has not been terminated, and subject to the approval of the Court, the Escrow Agent may make payments for Attorney Fee Awards, Class Plaintiffs’ Awards, Expense Awards not already paid, Settlement Administration Costs not already paid, and for the timely and proper claims of Authorized Cash Claimants pursuant to the Plan of Administration and Distribution approved by the Court and administered by the Class Administrator.

(e) All disbursements described in Section 8(a)-(d), above, and any other disbursements from the Class Settlement Cash Escrow Account(s), must be authorized by an order of the Court; provided, however, that the Court’s Order Preliminarily Approving the Settlement shall authorize, without further Order of the Court, but subject to the cap provided in Paragraph 21(c) of the Class Settlement Agreement, the payment of all taxes due (including administrative costs of paying such taxes), all costs for postage, printing, and mailing of the Class Notice, and all costs of the Court-approved Publication Notice.

(f) Consistent with the orders of the Court, the Escrow Agent may rely on transfer or disbursement instructions provided in a signed writing on firm letterhead by a counsel listed below in Section 16 for each of the Class Counsel, Visa Defendants, and MasterCard Defendants. Alternatively, the Escrow Agent may rely on such transfer or disbursement instructions provided in a signed writing on firm letterhead by a counsel listed in Section 16 below for either Class Counsel, the Visa Defendants, or the MasterCard Defendants, if that writing is copied to the counsel for the other Parties listed in Section 16 and one of those counsel for each of the other Parties confirms the instructions by email or other writing. If the Escrow Agent is unable to verify the instructions, or is not satisfied with the verification it receives, it shall not execute the instruction until all issues have been resolved. The Escrow Agent shall

 

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provide prompt notice as provided in Section 16 that instructions and transactions have been executed, and the Parties agree to notify the Escrow Agent of any errors, delays, or other problems within 30 days after receiving notification that an instruction and transaction has been executed. If it is determined that the transaction was delayed or erroneously executed as a result of the Escrow Agent’s error, the Escrow Agent’s sole obligation is to pay or refund the amount of such error and any amounts as may be required by applicable law. Any claim for interest payable will be at the then-published rate for United States Treasury Bills having a maturity of 91 days.

9. Termination of Class Settlement Agreement. If the Class Settlement Agreement terminates, upon notification thereof being provided to the Escrow Agent, any sums in the Class Settlement Cash Escrow Account(s), together with any interest, dividends, and other disbursements and payments earned thereon, less any Taxes due and owing and Settlement Administration Costs approved by the Court and already paid or incurred in accordance with the terms of the Class Settlement Agreement, shall be promptly paid to the Visa Defendants and the MasterCard Defendants in accordance with Paragraph 99(a) of the Class Settlement Agreement.

10. Fees. For all services rendered by the Escrow Agent pursuant to this Escrow Agreement, the Escrow Agent shall waive its standard charges and fees. If the Escrow Agent is asked to provide additional services, the Escrow Agent and the Parties must first agree to a separate fee schedule for such services. All such fees of the Escrow Agent shall be paid solely from the Class Settlement Cash Escrow Account(s). The Escrow Agent may pay itself such fees from the Class Settlement Cash Escrow Account(s) only after such fees have been approved for payment by the Court, Class Counsel, the Visa Defendants, and the MasterCard Defendants.

11. Duties, Liabilities and Rights of Escrow Agent. This Escrow Agreement sets forth all of the obligations of the Escrow Agent, and no additional obligations shall be implied from the terms of this Escrow Agreement or any other agreement, instrument, or document.

(a) The Escrow Agent shall deal with the contents of the Class Settlement Cash Escrow Account(s) only in accordance with this Escrow Agreement.

(b) The Escrow Agent may act in reliance upon any instructions, notice, certification, demand, consent, authorization, receipt, power of attorney, or other writing delivered to it by Class Counsel or the Visa Defendants or the MasterCard Defendants, as provided herein, without being required to determine the authenticity or validity thereof or the correctness of any fact stated therein, the propriety or validity of the service thereof, or the jurisdiction of the court issuing any judgment or order. The Escrow Agent may act in reliance upon any signature which is reasonably believed by it to be genuine, and may assume that such person has been properly authorized to do so.

(c) The Escrow Agent may consult with legal counsel of its selection in the event of any dispute or question as to the meaning or construction of any of the provisions hereof or its duties hereunder, and it shall incur no liability and shall be fully protected to the extent the Escrow Agent acts in accordance with the reasonable opinion and instructions of counsel. The Escrow Agent shall have the right to reimburse itself for reasonable legal fees and reasonable and necessary disbursements and expenses actually incurred from the Class Settlement Cash

 

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Escrow Account(s) only (i) upon approval by Class Counsel and the Visa Defendants and the MasterCard Defendants, and (ii) pursuant to an order of the Court.

(d) The Escrow Agent, or any of its affiliates, is authorized to manage, advise, or service any money market mutual funds in which any portion of the Class Settlement Cash Escrow Account(s) may be invested.

(e) The Escrow Agent is authorized (but not required) to hold any treasuries held hereunder in its Federal Reserve account. Alternatively, the Escrow Agent may hold treasuries or other securities in a segregated account held by a qualified third-party financial institution.

(f) The Escrow Agent shall not bear any risks related to the investment of the Class Settlement Cash Escrow Account(s) in accordance with the provisions of Section 4 of this Escrow Agreement. The Escrow Agent will be indemnified by the Class Settlement Cash Escrow Account(s), and held harmless against, any and all claims, suits, actions, proceedings, investigations, judgments, deficiencies, damages, settlements, liabilities and expenses (including reasonable legal fees and expenses of attorneys chosen by the Escrow Agent) as and when incurred, arising out of or based upon any act, omission, alleged act or alleged omission by the Escrow Agent or any other cause, in any case in connection with the acceptance of, or performance or non-performance by the Escrow Agent of, any of the Escrow Agent’s duties under this Escrow Agreement, except as a result of the Escrow Agent’s bad faith, willful misconduct, negligence, or gross negligence.

(g) Upon distribution of all of the funds in the Class Settlement Cash Escrow Account(s) pursuant to the terms of this Escrow Agreement and any orders of the Court, the Escrow Agent shall be relieved of any and all further obligations and released from any and all liability under this Escrow Agreement, except as otherwise specifically set forth herein.

(h) The Escrow Agent shall not have any interest in the Class Settlement Cash Escrow Account(s), but shall serve as escrow holder only and shall have possession thereof.

12. Non-Assignability by Escrow Agent. The Escrow Agent’s rights, duties and obligations hereunder may not be assigned or assumed without the written consent of Class Counsel and the Visa Defendants and the MasterCard Defendants.

13. Resignation of Escrow Agent. The Escrow Agent may, in its sole discretion, resign and terminate its position hereunder at any time following 120 days prior written notice to the parties to this Escrow Agreement. On the effective date of such resignation, the Escrow Agent shall deliver this Escrow Agreement together with any and all related instruments or documents and all funds in the Class Settlement Cash Escrow Account(s) to the successor Escrow Agent, subject to this Escrow Agreement and an accounting of the funds held in such Class Settlement Cash Escrow Account(s). If a successor Escrow Agent has not been appointed prior to the expiration of 120 days following the date of the notice of such resignation, then the Escrow Agent may petition the Court for the appointment of a successor Escrow Agent, or other appropriate relief. Any such resulting appointment shall be binding upon all of the parties to this Escrow Agreement.

 

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Notwithstanding any resignation or removal of the Escrow Agent pursuant to this Section 13, the Escrow Agent shall continue to serve in its capacity as Escrow Agent until each of the following has occurred: (a) a successor escrow agent being appointed in accordance with the provisions of Section 14 and having accepted such appointment, and (b) all sums in the Class Settlement Cash Escrow Account(s) having been transferred to and received by such successor escrow agent along with the records pertaining to the Class Settlement Cash Escrow Account(s).

14. Appointment of Successor Escrow Agent. If at any time the Escrow Agent shall resign, be removed, or otherwise become incapable of acting as escrow agent pursuant to this Agreement, or if at any time a vacancy shall occur in the office of the Escrow Agent for any other cause, a qualified successor escrow agent shall be appointed by the Parties (other than the Escrow Agent) by a written instrument with the successor escrow agent that is approved and ordered by the Court. If no qualified successor escrow agent has been appointed at the effective date of resignation or removal of the Escrow Agent or within thirty (30) days after the time the Escrow Agent became incapable of acting as the Escrow Agent or a vacancy occurred in the office of the Escrow Agent, any Party hereto (other than the Escrow Agent) may petition the Court for an appointment of a qualified successor escrow agent, and the Escrow Agent shall have the right to refuse to make any payments from the Class Settlement Cash Escrow Account(s) until a qualified successor escrow agent is appointed and has accepted such appointment. Upon the appointment and acceptance of any qualified successor escrow agent hereunder, the Escrow Agent shall transfer the contents of the Class Settlement Cash Escrow Account(s) to its successor. Upon receipt by the successor escrow agent of those contents, the Escrow Agent shall be discharged from any continuing duties or obligations under this Agreement, but such discharge shall not relieve the Escrow Agent from any powers, duties, and obligations of the Escrow Agent under this Escrow Agreement arising prior to its replacement.

15. Parties’ Appointment of New Escrow Agent or Custodian Banks. A new and qualified Escrow Agent may be appointed to succeed the current Escrow Agent by a written agreement among Class Counsel, the Visa Defendants, and the MasterCard Defendants that is approved and ordered by the Court. New and qualified Custodian Banks may be appointed to succeed the current Custodian Banks or to be additional Custodian Banks by a written agreement among Class Counsel, the Visa Defendants, the MasterCard Defendants, and the Escrow Agent that is approved and ordered by the Court.

16. Notices. Notice to the parties hereto shall be in writing and delivered by electronic mail and by hand-delivery, facsimile, or overnight courier service, addressed as follows:

 

If to the Escrow Agent:    Christopher Ritchie, Senior Vice President
   The Huntington National Bank
   1150 First Avenue, Suite 103
   King of Prussia, PA 19406
   Telephone: (215) 568-2328
   Facsimile:  (215) 568-2385
   E-Mail: chris.ritchie@huntington.com

 

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   Candi Moore, Senior Vice President
   The Huntington National Bank
   7 Easton Oval — EA4E63
   Columbus, OH 43219
   Telephone: (614) 331-9556
   Facsimile:  (614) 331-5862
   E-Mail: candi.moore@huntington.com
If to Class Counsel:    Thomas J. Undlin
   Robins, Kaplan, Miller & Ciresi L.L.P.
   800 LaSalle Avenue
   2800 LaSalle Plaza
   Minneapolis, MN 55402-2015
   Telephone: (612) 349-8706
   Facsimile:  (612) 339-4181
   E-Mail: tjundlin@rkmc.com
   Merrill G. Davidoff
   Berger & Montague, P.C.
   1622 Locust Street
   Philadelphia, PA 19103
   Telephone: (215) 875-3000
   Facsimile:  (215) 875-4604
   E-Mail: mdavidoff@bm.net
   Keith F. Park
   Robbins, Geller, Rudman & Dowd LLP
   655 West Broadway
   Suite 1900
   San Diego, CA 92101
   Telephone: (619) 231-1058
   Facsimile:  (619) 231-7423
   E-Mail: keithp@rgrdlaw.com
If to Visa Defendants    General Counsel
   Visa Inc.
   P.O. Box 8999
   San Francisco, CA 94128-8999
   Telephone: (415) 932-2100
   Facsimile:  (415) 932-2531

 

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   Adam R. Eaton
   Visa Inc.
   P.O. Box 266001
   Highlands Ranch, CO 80163-6001
   Telephone: (303) 389-7156
   Facsimile:  (303) 389-7113
   E-Mail: aeaton@visa.com
   Robert J. Vizas
   Arnold & Porter LLP
   Three Embarcadero Center, 7th Floor
   San Francisco, CA 94111-4024
   Telephone: (415) 471-3100
   Facsimile:  (415) 471-3400
   Email: robert.vizas@aporter.com
   Mark R. Merley
   Matthew A. Eisenstein
   Arnold & Porter LLP
   555 Twelfth Street, NW 20004-1206
   Telephone: (202) 942-5000
   Facsimile:  (202) 942-5999
   E-Mail: mark.merley@aporter.com
   E-Mail: matthew.eisenstein@aporter.com
   Robert C. Mason
   Arnold & Porter LLP
   399 Park Avenue
   New York, NY 10022-4690
   Telephone: (212) 715-1000
   Facsimile:  (212) 715-1399
   E-Mail: robert.mason@aporter.com
If to MasterCard Defendants    Noah J. Hanft
   James P. Masterson
   MasterCard Worldwide
   2000 Purchase Street
   Purchase, NY 10577
   Telephone: (914) 249-2000
   Facsimile:  (914) 249-4262

 

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   Kenneth A. Gallo
   Paul, Weiss, Rifkind, Wharton & Garrison LLP
   2001 K Street, N.W.
   Washington, DC 20006-1047
   Telephone: (202) 223-7300
   Facsimile:  (202) 223-7420
   E-Mail: kgallo@paulweiss.com
   Gary R. Caney
   Paul, Weiss, Rifkind, Wharton & Garrison LLP
   1285 Avenue of the Americas
   New York, NY 10019-6064
   Telephone: (212) 373-3000
   Facsimile:  (212) 757-3990
   E-Mail: gcarney@paulweiss.com
   Keila D. Ravelo
   Wesley R. Powell
   Matthew Freimuth
   Willkie Farr & Gallagher LLP
   787 Seventh Avenue
   New York, NY 10019-6099
   Telephone: (212) 728-6099
   Facsimile:  (212) 728-8111
   E-Mail: kravelo@willkie.com
   E-Mail: wpowell@willkie.com
   E-Mail: mfreimuth@willkie.com

or to such other address or to such person as any Party shall have last designated by notice to the other Parties.

17. Patriot Act Warranties.

(a) The Visa Defendants and the MasterCard Defendants hereby acknowledge that they will seek to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, the Visa Defendants and the MasterCard Defendants hereby represent, warrant, and agree that, to the best of their knowledge:

(i) none of the cash or property that it has paid, will pay, or will contribute to the Class Settlement Cash Escrow Account(s) has been or shall be derived from, or related to, an activity that is deemed criminal under United States law; and

(ii) no contribution or payment by the Defendants to the Class Settlement Cash Escrow Account(s) shall cause the Escrow Agent to be in violation of the United States Bank Secrecy Act, the United States Money Laundering Control Act of 1986, or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001.

 

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(b) The Visa Defendants and the MasterCard Defendants agree to promptly notify the Escrow Agent and Class Counsel if any of the foregoing representations cease to be true and accurate. Each such Defendant agrees to provide to the Escrow Agent any additional information regarding it that is reasonably necessary or appropriate for the Escrow Agent to ensure its compliance with all applicable laws concerning money laundering and similar activities, subject to any confidentiality obligations (recognized or permitted by law) that may restrict or prohibit the Defendant from providing such information. The Escrow Agent agrees to keep any information provided by the Defendant pursuant to this Section confidential, and will not disclose such information to any other party except to the extent necessary or appropriate to ensure compliance with all applicable laws concerning money laundering and similar activities; provided, however, that the Escrow Agent shall give notice to the Defendant as soon as practicable in the event it expects that such a disclosure will become necessary.

(c) The Visa Defendants and the MasterCard Defendants agree that if at any time the Escrow Agent reasonably determines that any of the foregoing representations are incorrect with respect to any one of those Defendants, or if otherwise required by applicable law or regulation related to money laundering and similar activities, the Escrow Agent may undertake whatever actions are reasonably appropriate to ensure compliance with applicable law or regulation.

18. Assignment; Parties in Interest. This Escrow Agreement is binding upon and will inure to the benefit of the Parties hereto and their respective successors and permitted assigns, but will not be assignable, by operation of law or otherwise, by any Party hereto without the prior written consent of the other Parties subject to Section 14. Nothing in this Escrow Agreement is intended to create any legally enforceable rights in any other non-Party person or entity, or to make any non-Party person or entity, including but not limited to any proposed or potential non-Party recipient of funds from the Class Settlement Cash Escrow Account(s) or under the Class Settlement Agreement, a beneficiary of this Escrow Agreement.

19. Entire Agreement. This Escrow Agreement, including the fee schedule attached hereto, constitutes the entire agreement and understanding of the parties hereto. Any modification of this Escrow Agreement or any additional obligations assumed by any party hereto shall be binding only if evidenced by a writing signed by each of the Parties hereto. This Escrow Agreement may not be modified or amended in any way that could jeopardize, impair, or modify the qualified settlement fund status of the Class Settlement Cash Escrow Account(s).

20. Class Settlement Agreement Governs. To the extent this Escrow Agreement conflicts in any way with the Class Settlement Agreement, the provisions of the Class Settlement Agreement shall govern.

21. Governing Law. This Escrow Agreement shall be governed by the law of the State of New York in all respects, without regard to its choice of law or conflicts of laws principles, other than New York General Obligations Law Sections 5-1401 and 5-1402.

22. Forum for Disputes. The Parties hereto submit to the jurisdiction of the Court in the Action, in connection with any proceedings commenced regarding this Escrow Agreement, including, but not limited to, any interpleader proceeding or proceeding the Escrow Agent may

 

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commence pursuant to this Escrow Agreement for the appointment of a successor escrow agent, and all Parties hereto submit to the jurisdiction of such Court for the determination of all issues in such proceedings, and irrevocably waive any objection to venue or inconvenient forum. All applications to the Court with respect to any aspect of the Escrow Agreement shall be presented to and determined by United States District Court Judge John Gleeson for resolution as a matter within the scope of MDL 1720, or, if he is not available, any other District Court Judge designated by the Court.

23. Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Escrow Agreement is not performed in substantial accordance with the terms hereof and that the Parties will be entitled to a specific performance of the terms hereof in addition to any other remedy to which they are entitled at law or equity.

24. Termination of Class Settlement Cash Escrow Account(s). The Class Settlement Cash Escrow Account(s) will terminate after all funds and financial assets deposited in them, together with all interest earned thereon, are disbursed in accordance with the provisions of the Class Settlement Agreement and this Escrow Agreement.

25. Miscellaneous Provisions.

(a) Sections and Other Headings. Sections or other headings contained in this Escrow Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Escrow Agreement.

(b) Counterparts. This Escrow Agreement may be executed in one or more counterparts, each of which counterparts shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Escrow Agreement.

(c) Further Cooperation. The Parties hereto agree to do such further acts and things and to execute and deliver such other documents as the Escrow Agent may request from time to time in connection with the administration, maintenance, enforcement or adjudication of this Escrow Agreement in order (a) to give the Escrow Agent confirmation and assurance of the Escrow Agent’s rights, powers, privileges, remedies and interests under this Agreement and applicable law, (b) to better enable the Escrow Agent to exercise any such right, power, privilege or remedy, or (c) to otherwise effectuate the purpose and the terms and provisions of this Escrow Agreement, each in such form and substance as may be acceptable to the Escrow Agent.

(d) Non-Waiver. The failure of any of the Parties hereto to enforce any provision hereof on any occasion shall not be deemed to be a waiver of any preceding or succeeding breach of such provision or any other provision.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

 

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The Huntington National Bank, as Escrow Agent

 

By:   

 

  Christopher Ritchie
  Senior Vice President
  The Huntington National Bank
  1150 First Avenue, Suite 103
  King of Prussia, PA 19406
  (215) 568-2328
Class Counsel
By:   

 

  Merrill G. Davidoff
  Berger & Montague, P.C.
  1622 Locust Street
  Philadelphia, PA 19103
  (215) 875-3000

Visa Defendants

(Visa Inc., Visa U.S.A. Inc., and Visa International Service Association)

 

By:   

 

  Joshua Floum
  General Counsel
  Visa Inc.
  P.O. Box 8999
  San Francisco, CA 94128-8999
  (650) 432-1481

 

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MasterCard Defendants

(MasterCard International Incorporated and MasterCard Incorporated)

 

By:   

 

  Noah J. Hanft

        General Counsel and Chief Franchise Integrity Officer

  MasterCard Worldwide
  2000 Purchase Street
  Purchase, NY 10577
  (914) 249-2000

 

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APPENDIX C — Class Settlement Interchange Escrow Agreement

This Class Settlement Interchange Escrow Agreement (“Escrow Agreement”) dated October 19, 2012, is made and entered into in connection with the concurrently executed Definitive Class Settlement Agreement (the “Class Settlement Agreement”) in the matter of In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, No. 05-MD-1720(JG)(JO) (“The Action”). This Escrow Agreement is entered into on behalf of the Class Plaintiffs, by and through Class Counsel; each of the Visa Defendants and the MasterCard Defendants, by and through their respective authorized signatories below; and The Huntington National Bank as escrow agent (the “Escrow Agent”) (collectively, the “Parties”).

Recitals

A. This Escrow Agreement governs the administration, maintenance, investment, and disbursement of the Default Interchange Payments to be deposited into the Interchange Settlement Escrow Account(s) subject to the terms provided in the Class Settlement Agreement.

B. The Default Interchange Payments deposited into the Class Settlement Interchange Escrow Account(s), together with any interest, dividends, and other distributions and payments accrued thereon, is to be used by the Escrow Agent solely in the manner provided in the Class Settlement Agreement and approved by the Court.

C. In no event shall the Visa Defendants or the MasterCard Defendants, any other Defendant, or any other Rule 23(b)(3) Settlement Class Released Party or Rule 23(b)(2) Settlement Class Released Party, except The Huntington National Bank to the extent of its obligations as Escrow Agent herein, have any obligation, responsibility, or liability arising from or relating to the administration, maintenance, preservation, investment, use, allocation, adjustment, distribution, disbursement, or disposition of any funds in the Class Settlement Interchange Escrow Account(s).

D. Unless otherwise defined herein, all capitalized terms shall have the meaning ascribed to them in the Class Settlement Agreement, and the terms of the Class Settlement Agreement are hereby incorporated by reference into this Escrow Agreement.

Agreement

1. Appointment of Escrow Agent. The Escrow Agent is hereby appointed to establish the Class Settlement Interchange Escrow Account(s) and to receive, deposit, administer, maintain, invest, and disburse the Default Interchange Payments upon the terms and conditions provided in this Escrow Agreement, the Class Settlement Agreement, and any other exhibits or schedules annexed hereto and made a part hereof.

2. Qualifications. The Escrow Agent and any bank at which the Escrow Agent maintains a Class Settlement Interchange Escrow Account for the purposes of this Escrow Agreement shall at all times be a bank, savings and loan association, and/or trust company in good standing, organized and doing business under the laws of the United States or a State of the United States, having assets of not less than twenty-five billion dollars ($25,000,000,000). The

 

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Escrow Agent shall be authorized under such laws to enter into and perform this Escrow Agreement, and shall be unrelated to and independent of the Class Plaintiffs and the Defendants within the meaning of Treasury Regulations § 1.468B-1(d) and § 1.468B-3(c)(2)(A). If the Escrow Agent at any time ceases to have the foregoing qualifications, the Escrow Agent shall give notice of resignation to the other Parties and a qualified successor escrow agent shall be appointed in accordance with Section 14 of this Escrow Agreement.

3. The Escrow Account. The Escrow Agent shall establish, maintain, and receive and disburse funds from one or more escrow accounts titled as the Class Settlement Interchange Escrow Account(s) at financial institutions (the “Custodian Banks”), into which the Default Interchange Payments shall be deposited subject to and in accordance with the terms of the Class Settlement Agreement. The Custodian Banks shall be the Huntington National Bank and U.S. Bank. The Escrow Agent shall provide the Parties with notice of the names and account numbers for those Class Settlement Interchange Escrow Account(s), and with monthly account statements or reports that describe all deposits, investments, disbursements, and other activities with respect to funds in those Class Settlement Interchange Escrow Account(s). The Class Settlement Interchange Escrow Account(s) shall be segregated accounts held and invested on the terms and subject to the limitations set forth herein, and funds or financial assets contained therein shall be invested and disbursed by the Escrow Agent in accordance with the terms and conditions hereinafter set forth and set forth in the Class Settlement Agreement and in orders of the Court approving the disbursement of the funds or financial assets contained therein.

4. Investment of the Class Settlement Interchange Escrow Account(s). The Escrow Agent shall invest all sums deposited into the Class Settlement Interchange Escrow Account(s) exclusively in instruments backed by the full faith and credit of the United States Government or fully insured by the United States Government, including a U.S. Treasury Money Market Fund, with a term of investment of no more than twelve months, or a bank account insured by the Federal Deposit Insurance Corporation (“FDIC”) up to, but in no event in excess of, the maximum amount so insured. Amounts which may reasonably be expected to be disbursed in the forthcoming three months shall be invested in such instruments with a maturity not to exceed three months. The Escrow Agent shall reinvest the proceeds of these instruments as they mature in those same types of instruments at their then-current market rates. The Escrow Agent may, with reasonable notice to Class Counsel, sell or liquidate any of the foregoing investments at any time if the proceeds thereof are required for any disbursement of funds from the Class Settlement Interchange Escrow Account(s) under this Escrow Agreement and the Class Settlement Agreement. Except as provided in the Class Settlement Agreement, all interest, dividends, and other distributions and payments in connection with the investment of the Class Settlement Interchange Escrow Account(s) shall accrue to the benefit of the Class Settlement Interchange Escrow Account(s). All losses, costs or penalties resulting from any sale or liquidation of the investments of the Class Settlement Interchange Escrow Account(s) shall be charged against the Class Settlement Interchange Escrow Account(s).

5. Escrow Funds Subject to Jurisdiction of the Court. The Class Settlement Interchange Escrow Account(s) shall remain subject to the jurisdiction of the Court, and be under the continuing supervision of the Court, until such time as the funds contained therein are fully distributed pursuant to the Class Settlement Agreement and on further order(s) of the Court.

 

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6. Tax Treatment & Report. The Class Settlement Interchange Escrow Account(s) shall be set up, maintained, and treated at all times as a “Qualified Settlement Fund” within the meaning of Treasury Regulation §1.468B-1 and any analogous local, state, and/or foreign statute, law, regulation, or rule. The Escrow Agent shall timely make such elections as necessary or advisable to fulfill the requirements of such Treasury Regulation, including the “relation-back election” under Treas. Reg. § 1.468B-1(j)(2) to the earliest permitted date. Such election shall be made in compliance with the procedures and requirements contained in the Treasury Regulations. For purposes of §468B of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, the “administrator” of the Class Settlement Interchange Escrow Account(s) shall be the Escrow Agent. The Escrow Agent shall timely and properly prepare, deliver to all necessary parties for signature, and file all necessary documentation for any elections required under Treas. Reg. §1.468B-1. Escrow Agent shall timely and properly prepare and file any informational and other tax returns necessary or advisable with respect to the Class Settlement Interchange Escrow Account(s) and the distributions and payments therefrom, including without limitation the returns described in Treasury Regulation §1.468B-2(k), and to the extent applicable Treasury Regulation §1.468B-2(1).

7. Tax Payments of Class Settlement Interchange Escrow Account(s). All Taxes with respect to income earned on the Class Settlement Interchange Escrow Account(s), as more fully described in the Class Settlement Agreement, shall be treated as and considered to be a cost of administration of the Settlement Fund and the Escrow Agent shall timely pay such Taxes out of the Class Settlement Interchange Escrow Account(s), as appropriate, without prior order of the Court. The Escrow Agent shall be responsible for the timely and proper preparation and delivery of any necessary documentation for signature by all necessary parties, and the timely filing of all tax returns and other tax reports required by law, and the withholding of any taxes required by law; provided that the Escrow Agent shall have no 1099 reporting obligations with respect to any distribution, compensation, income or other benefits paid to Authorized Interchange Claimants (which tax reporting duties shall be fulfilled by the Class Administrator). The Escrow Agent may engage an accounting firm or tax preparer to assist in the preparation of any tax reports or the calculation of any tax payments due as set forth in Sections 6 and 7, and the expense of such assistance shall be paid from the Class Settlement Interchange Escrow Account(s). The Class Settlement Interchange Escrow Account(s) shall indemnify and hold the Defendants harmless for any taxes that may be deemed to be payable by the Defendants by reason of the income earned on the Class Settlement Interchange Escrow Account(s), and the Escrow Agent shall establish such reserves as are necessary to cover the tax liabilities of the Class Settlement Interchange Escrow Account(s) and the indemnification obligations imposed by this Section.

8. Disbursement Instructions. Disbursements from the Class Settlement Interchange Escrow Account(s) are to be made only in accordance with the terms and provisions contained in Paragraphs 25-26 of the Class Settlement Agreement, upon written authorization of Class Counsel and the Visa Defendants and the MasterCard Defendants, and include the following:

(a) Pursuant to Paragraph 25 of the Class Settlement Agreement, the Escrow Agent may make payments prior to ten days after the Settlement Final Date only in the amounts approved by the Court and only to pay for (i) the costs of establishing, maintaining, or administering the Class Settlement Interchange Escrow Account(s), including Taxes and the administrative costs of paying such Taxes; (ii) Settlement Administration Costs, in amounts consistent with the limitations of Paragraph 25(b) of the Class Settlement Agreement.

 

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(b) Pursuant to Paragraph 26 of the Class Settlement Agreement, commencing the day after ten business days after the Settlement Final Date, the Escrow Agent may make payments in amounts approved by the Court, including for paying the timely and proper claims of Authorized Interchange Claimants pursuant to the Plan of Administration and Distribution approved by the Court and administered by the Class Administrator.

(c) All disbursements described in Section 8(a)-(b), above, and any other disbursements from the Class Settlement Interchange Escrow Account(s), must be authorized by an order of the Court; provided, however, that the Court’s Order Preliminarily Approving the Settlement may authorize, without further Order of the Court, but subject to the cap provided in Paragraph 25(c) of the Class Settlement Agreement, the payment of all taxes due (including administrative costs of paying such taxes).

(d) Consistent with the orders of the Court, the Escrow Agent may rely on transfer or disbursement instructions provided in a signed writing on firm letterhead by a counsel listed below in Section 16 for each of the Class Counsel, Visa Defendants, and MasterCard Defendants. Alternatively, the Escrow Agent may rely on such transfer or disbursement instructions provided in a signed writing on firm letterhead by a counsel listed in Section 16 below for either Class Counsel, the Visa Defendants, or the MasterCard Defendants, if that writing is copied to the counsel for the other Parties listed in Section 16 and one of those counsel for each of the other Parties confirms the instructions by email or other writing. If the Escrow Agent is unable to verify the instructions, or is not satisfied with the verification it receives, it shall not execute the instruction until all issues have been resolved. The Escrow Agent shall provide prompt notice as provided in Section 16 that instructions and transactions have been executed, and the Parties agree to notify the Escrow Agent of any errors, delays, or other problems within 30 days after receiving notification that an instruction and transaction has been executed. If it is determined that the transaction was delayed or erroneously executed as a result of the Escrow Agent’s error, the Escrow Agent’s sole obligation is to pay or refund the amount of such error and any amounts as may be required by applicable law. Any claim for interest payable will be at the then-published rate for United States Treasury Bills having a maturity of 91 days.

9. Termination of Class Settlement Agreement. If the Class Settlement Agreement terminates, upon notification thereof being provided to the Escrow Agent, any sums in the Class Settlement Interchange Escrow Account(s), together with any interest, dividends, and other disbursements and payments earned thereon, less any Taxes due and owing and Settlement Administration Costs approved by the Court and already paid or incurred in accordance with the terms of the Class Settlement Agreement, shall remain in the Class Settlement Interchange Escrow Account(s), and shall be distributed in the manner determined by the Court, if the parties do not enter into a new Class Settlement Agreement addressing such distribution, in accordance with Paragraph 99(b) of the Class Settlement Agreement.

10. Fees. For all services rendered by the Escrow Agent pursuant to this Escrow Agreement, the Escrow Agent shall waive its standard charges and fees. If the Escrow Agent is asked to provide additional services, the Escrow Agent and the Parties must first agree to a separate fee schedule for such services. All such fees and expenses of the Escrow Agent shall be paid solely from the Class Settlement Interchange Escrow Account(s). The Escrow Agent may

 

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pay itself such fees from the Class Settlement Interchange Escrow Account(s) only after such fees have been approved for payment by the Court, Class Counsel, the Visa Defendants, and the MasterCard Defendants.

11. Duties, Liabilities and Rights of Escrow Agent. This Escrow Agreement sets forth all of the obligations of the Escrow Agent, and no additional obligations shall be implied from the terms of this Escrow Agreement or any other agreement, instrument, or document.

(a) The Escrow Agent shall deal with the contents of the Class Settlement Interchange Escrow Account(s) only in accordance with this Escrow Agreement.

(b) The Escrow Agent may act in reliance upon any instructions, notice, certification, demand, consent, authorization, receipt, power of attorney, or other writing delivered to it by Class Counsel or the Visa Defendants or the MasterCard Defendants, as provided herein, without being required to determine the authenticity or validity thereof or the correctness of any fact stated therein, the propriety or validity of the service thereof, or the jurisdiction of the court issuing any judgment or order. The Escrow Agent may act in reliance upon any signature which is reasonably believed by it to be genuine, and may assume that such person has been properly authorized to do so.

(c) The Escrow Agent may consult with legal counsel of its selection in the event of any dispute or question as to the meaning or construction of any of the provisions hereof or its duties hereunder, and it shall incur no liability and shall be fully protected to the extent the Escrow Agent acts in accordance with the reasonable opinion and instructions of counsel. The Escrow Agent shall have the right to reimburse itself for reasonable legal fees and reasonable and necessary disbursements and expenses actually incurred from the Class Settlement Interchange Escrow Account(s) only (i) upon approval by Class Counsel and the Visa Defendants and the MasterCard Defendants, and (ii) pursuant to an order of the Court.

(d) The Escrow Agent, or any of its affiliates, is authorized to manage, advise, or service any money market mutual funds in which any portion of the Class Settlement Interchange Escrow Account(s) may be invested.

(e) The Escrow Agent is authorized (but not required) to hold any treasuries held hereunder in its Federal Reserve account. Alternatively, the Escrow Agent may hold treasuries or other securities in a segregated account held by a qualified third-party financial institution.

(f) The Escrow Agent shall not bear any risks related to the investment of the Class Settlement Interchange Escrow Account(s) in accordance with the provisions of Section 4 of this Escrow Agreement. The Escrow Agent will be indemnified by the Class Settlement Interchange Escrow Account(s), and held harmless against, any and all claims, suits, actions, proceedings, investigations, judgments, deficiencies, damages, settlements, liabilities and expenses (including reasonable legal fees and expenses of attorneys chosen by the Escrow Agent) as and when incurred, arising out of or based upon any act, omission, alleged act or alleged omission by the Escrow Agent or any other cause, in any case in connection with the acceptance of, or performance or non-performance by the Escrow Agent of, any of the Escrow

 

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Agent’s duties under this Escrow Agreement, except as a result of the Escrow Agent’s bad faith, willful misconduct, negligence, or gross negligence.

(g) Upon distribution of all of the funds in the Class Settlement Interchange Escrow Account(s) pursuant to the terms of this Escrow Agreement and any orders of the Court, the Escrow Agent shall be relieved of any and all further obligations and released from any and all liability under this Escrow Agreement, except as otherwise specifically set forth herein.

(h) The Escrow Agent shall not have any interest in the Class Settlement Interchange Escrow Account(s), but shall serve as escrow holder only and shall have possession thereof.

12. Non-Assignability by Escrow Agent. The Escrow Agent’s rights, duties and obligations hereunder may not be assigned or assumed without the written consent of Class Counsel and the Visa Defendants and the MasterCard Defendants.

13. Resignation of Escrow Agent. The Escrow Agent may, in its sole discretion, resign and terminate its position hereunder at any time following 120 days prior written notice to the parties to this Escrow Agreement. On the effective date of such resignation, the Escrow Agent shall deliver this Escrow Agreement together with any and all related instruments or documents and all funds in the Class Settlement Interchange Escrow Account(s) to the successor Escrow Agent, subject to this Escrow Agreement and an accounting of the funds held in such Class Settlement Interchange Escrow Account(s). If a successor Escrow Agent has not been appointed prior to the expiration of 120 days following the date of the notice of such resignation, then the Escrow Agent may petition the Court for the appointment of a successor Escrow Agent, or other appropriate relief. Any such resulting appointment shall be binding upon all of the parties to this Escrow Agreement.

Notwithstanding any resignation or removal of the Escrow Agent pursuant to this Section 13, the Escrow Agent shall continue to serve in its capacity as Escrow Agent until each of the following has occurred: (a) a successor escrow agent being appointed in accordance with the provisions of Section 14 and having accepted such appointment, and (b) all sums in the Class Settlement Interchange Escrow Account(s) having been transferred to and received by such successor escrow agent along with the records pertaining to the Class Settlement Interchange Escrow Account(s).

14. Appointment of Successor Escrow Agent. If at any time the Escrow Agent shall resign, be removed, or otherwise become incapable of acting as escrow agent pursuant to this Agreement, or if at any time a vacancy shall occur in the office of the Escrow Agent for any other cause, a qualified successor escrow agent shall be appointed by the Parties (other than the Escrow Agent) by a written instrument with the successor escrow agent that is approved and ordered by the Court. If no qualified successor escrow agent has been appointed at the effective date of resignation or removal of the Escrow Agent or within thirty (30) days after the time the Escrow Agent became incapable of acting as the Escrow Agent or a vacancy occurred in the office of the Escrow Agent, any Party hereto (other than the Escrow Agent) may petition the Court for an appointment of a qualified successor escrow agent, and the Escrow Agent shall have the right to refuse to make any payments from the Class Settlement Interchange Escrow

 

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Account(s) until a qualified successor escrow agent is appointed and has accepted such appointment. Upon the appointment and acceptance of any qualified successor escrow agent hereunder, the Escrow Agent shall transfer the contents of the Class Settlement Interchange Escrow Account(s) to its successor. Upon receipt by the successor escrow agent of those contents, the Escrow Agent shall be discharged from any continuing duties or obligations under this Agreement, but such discharge shall not relieve the Escrow Agent from any powers, duties, and obligations of the Escrow Agent under this Escrow Agreement arising prior to its replacement.

15. Parties’ Appointment of New Escrow Agent or Custodian Banks. A new and qualified Escrow Agent may be appointed to succeed the current Escrow Agent by a written agreement among Class Counsel, the Visa Defendants, and the MasterCard Defendants that is approved and ordered by the Court. New and qualified Custodian Banks may be appointed to succeed the current Custodian Banks or to be additional Custodian Banks by a written agreement among Class Counsel, the Visa Defendants, the MasterCard Defendants, and the Escrow Agent that is approved and ordered by the Court.

16. Notices. Notice to the parties hereto shall be in writing and delivered by electronic mail and by hand-delivery, facsimile, or overnight courier service, addressed as follows:

 

If to the Escrow Agent:    Christopher Ritchie, Senior Vice President
   The Huntington National Bank
   1150 First Avenue, Suite 103
   King of Prussia, PA 19406
   Telephone: (215) 568-2328
   Facsimile:  (215) 568-2385
   E-Mail: chris.ritchie@huntington.com
   Candi Moore, Senior Vice President
   The Huntington National Bank
   7 Easton Oval — EA4E63
   Columbus, OH 43219
   Telephone: (614) 331-9556
   Facsimile:  (614) 331-5862
   E-Mail: candi.moore@huntington.com
If to Class Counsel:    Thomas J. Undlin
   Robins, Kaplan, Miller & Ciresi L.L.P.
   800 LaSalle Avenue
   2800 LaSalle Plaza
   Minneapolis, MN 55402-2015
   Telephone: (612) 349-8706
   Facsimile:  (612) 339-4181
   E-Mail: tjundlin@rkmc.com

 

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   Merrill G. Davidoff
   Berger & Montague, P.C.
   1622 Locust Street
   Philadelphia, PA 19103
   Telephone: (215) 875-3000
   Facsimile:  (215) 875-4604
   E-Mail: mdavidoff@bm.net
   Keith F. Park
   Robbins, Geller, Rudman & Dowd LLP
   655 West Broadway
   Suite 1900
   San Diego, CA 92101
   Telephone: (619) 231-1058
   Facsimile:  (619) 231-7423
   E-Mail: keithp@rgrdlaw.com
If to Visa Defendants    General Counsel
   Visa Inc.
   P.O. Box 8999
   San Francisco, CA 94128-8999
   Telephone: (415) 932-2100
   Facsimile:  (415) 932-2531
   Adam R. Eaton
   Visa Inc.
   P.O. Box 266001
   Highlands Ranch, CO 80163-6001
   Telephone: (303) 389-7156
   Facsimile:  (303) 389-7113
   E-Mail: aeaton@visa.com
   Robert J. Vizas
   Arnold & Porter LLP
   Three Embarcadero Center, 7th Floor
   San Francisco, CA 94111-4024
   Telephone: (415) 471-3100
   Facsimile:  (415) 471-3400
   Email: robert.vizas@aporter.com

 

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   Mark R. Merley
   Matthew A. Eisenstein
   Arnold & Porter LLP
   555 Twelfth Street, NW 20004-1206
   Telephone: (202) 942-5000
   Facsimile:  (202) 942-5999
   E-Mail: mark.merley@aporter.com
   E-Mail: matthew.eisenstein@aporter.com
   Robert C. Mason
   Arnold & Porter LLP
   399 Park Avenue
   New York, NY 10022-4690
   Telephone: (212) 715-1000
   Facsimile:  (212) 715-1399
   E-Mail: robert.mason@aporter.com
If to MasterCard Defendants    Noah J. Hanft
   James P. Masterson
   MasterCard Worldwide
   2000 Purchase Street
   Purchase, NY 10577
   Telephone: (914) 249-2000
   Facsimile:  (914) 249-4262
   Kenneth A. Gallo
   Paul, Weiss, Rifkind, Wharton & Garrison LLP
   2001 K Street, N.W.
   Washington, DC 20006-1047
   Telephone: (202) 223-7300
   Facsimile:  (202) 223-7420
   E-Mail: kgallo@paulweiss.com
   Gary R. Caney
   Paul, Weiss, Rifkind, Wharton & Garrison LLP
   1285 Avenue of the Americas
   New York, NY 10019-6064
   Telephone: (212) 373-3000
   Facsimile:  (212) 757-3990
   E-Mail: gcarney@paulweiss.com

 

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   Keila D. Ravelo
   Wesley R. Powell
   Matthew Freimuth
   Willkie Farr & Gallagher LLP
   787 Seventh Avenue
   New York, NY 10019-6099
   Telephone: (212) 728-6099
   Facsimile:  (212) 728-8111
   E-Mail: kravelo@willkie.com
   E-Mail: wpowell@willkie.com
   E-Mail: mfreimuth@willkie.com

or to such other address or to such person as any Party shall have last designated by notice to the other Parties.

17. Patriot Act Warranties.

(a) The Visa Defendants and the MasterCard Defendants hereby acknowledge that they will seek to comply with all applicable laws concerning money laundering and related activities. In furtherance of those efforts, the Visa Defendants and the MasterCard Defendants hereby represent, warrant, and agree that, to the best of their knowledge:

(i) none of the cash or property that it has paid, will pay, or will contribute to the Class Settlement Interchange Escrow Account(s) has been or shall be derived from, or related to, an activity that is deemed criminal under United States law; and

(ii) no contribution or payment by the Defendants to the Class Settlement Interchange Escrow Account(s) shall cause the Escrow Agent to be in violation of the United States Bank Secrecy Act, the United States Money Laundering Control Act of 1986, or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001.

(b) The Visa Defendants and the MasterCard Defendants agree to promptly notify the Escrow Agent and Class Counsel if any of the foregoing representations cease to be true and accurate. Each such Defendant agrees to provide to the Escrow Agent any additional information regarding it that is reasonably necessary or appropriate for the Escrow Agent to ensure its compliance with all applicable laws concerning money laundering and similar activities, subject to any confidentiality obligations (recognized or permitted by law) that may restrict or prohibit the Defendant from providing such information. The Escrow Agent agrees to keep any information provided by the Defendant pursuant to this Section confidential, and will not disclose such information to any other party except to the extent necessary or appropriate to ensure compliance with all applicable laws concerning money laundering and similar activities; provided, however, that the Escrow Agent shall give notice to the Defendant as soon as practicable in the event it expects that such a disclosure will become necessary.

(c) The Visa Defendants and the MasterCard Defendants agree that if at any time the Escrow Agent reasonably determines that any of the foregoing representations are

 

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incorrect with respect to any one of those Defendants, or if otherwise required by applicable law or regulation related to money laundering and similar activities, the Escrow Agent may undertake whatever actions are reasonably appropriate to ensure compliance with applicable law or regulation.

18. Assignment; Parties in Interest. This Escrow Agreement is binding upon and will inure to the benefit of the Parties hereto and their respective successors and permitted assigns, but will not be assignable, by operation of law or otherwise, by any Party hereto without the prior written consent of the other Parties subject to Section 14. Nothing in this Escrow Agreement is intended to create any legally enforceable rights in any other non-Party person or entity, or to make any non-Party person or entity, including but not limited to any proposed or potential non-Party recipient of funds from the Class Settlement Interchange Escrow Account(s) or under the Class Settlement Agreement, a beneficiary of this Escrow Agreement.

19. Entire Agreement. This Escrow Agreement, including the fee schedule attached hereto, constitutes the entire agreement and understanding of the parties hereto. Any modification of this Escrow Agreement or any additional obligations assumed by any party hereto shall be binding only if evidenced by a writing signed by each of the Parties hereto. This Escrow Agreement may not be modified or amended in any way that could jeopardize, impair, or modify the qualified settlement fund status of the Class Settlement Interchange Escrow Account(s).

20. Class Settlement Agreement Governs. To the extent this Escrow Agreement conflicts in any way with the Class Settlement Agreement, the provisions of the Class Settlement Agreement shall govern.

21. Governing Law. This Escrow Agreement shall be governed by the law of the State of New York in all respects, without regard to its choice of law or conflicts of laws principles, other than New York General Obligations Law Sections 5-1401 and 5-1402.

22. Forum for Disputes. The Parties hereto submit to the jurisdiction of the Court in the Action, in connection with any proceedings commenced regarding this Escrow Agreement, including, but not limited to, any interpleader proceeding or proceeding the Escrow Agent may commence pursuant to this Escrow Agreement for the appointment of a successor escrow agent, and all Parties hereto submit to the jurisdiction of such Court for the determination of all issues in such proceedings, and irrevocably waive any objection to venue or inconvenient forum. All applications to the Court with respect to any aspect of the Escrow Agreement shall be presented to and determined by United States District Court Judge John Gleeson for resolution as a matter within the scope of MDL 1720, or, if he is not available, any other District Court Judge designated by the Court.

23. Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Escrow Agreement is not performed in substantial accordance with the terms hereof and that the Parties will be entitled to a specific performance of the terms hereof in addition to any other remedy to which they are entitled at law or equity.

 

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24. Termination of Class Settlement Interchange Escrow Account(s). The Class Settlement Interchange Escrow Account(s) will terminate after all funds and financial assets deposited in them, together with all interest earned thereon, are disbursed in accordance with the provisions of the Class Settlement Agreement and this Escrow Agreement.

25. Miscellaneous Provisions.

(e) Sections and Other Headings. Sections or other headings contained in this Escrow Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Escrow Agreement.

(f) Counterparts. This Escrow Agreement may be executed in one or more counterparts, each of which counterparts shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Escrow Agreement.

(g) Further Cooperation. The Parties hereto agree to do such further acts and things and to execute and deliver such other documents as the Escrow Agent may request from time to time in connection with the administration, maintenance, enforcement or adjudication of this Escrow Agreement in order (a) to give the Escrow Agent confirmation and assurance of the Escrow Agent’s rights, powers, privileges, remedies and interests under this Agreement and applicable law, (b) to better enable the Escrow Agent to exercise any such right, power, privilege or remedy, or (c) to otherwise effectuate the purpose and the terms and provisions of this Escrow Agreement, each in such form and substance as may be acceptable to the Escrow Agent.

(h) Non-Waiver. The failure of any of the Parties hereto to enforce any provision hereof on any occasion shall not be deemed to be a waiver of any preceding or succeeding breach of such provision or any other provision.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

The Huntington National Bank, as Escrow Agent

 

By:   

 

  Christopher Ritchie
  Senior Vice President
  The Huntington National Bank
  1150 First Avenue, Suite 103
  King of Prussia, PA 19406
  (215) 568-2328

 

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Class Counsel
By:   

 

  Merrill G. Davidoff
  Berger & Montague, P.C.
  1622 Locust Street
  Philadelphia, PA 19103
  Telephone: (215) 875-3000
Visa Defendants

(Visa Inc., Visa U.S.A. Inc., and Visa International Service Association)

 

By:   

 

  Joshua Floum
  General Counsel
  Visa Inc.
  P.O. Box 8999
  San Francisco, CA 94128
  (650) 432-1481
MasterCard Defendants

(MasterCard International Incorporated and MasterCard Incorporated)

 

By:   

 

  Noah J. Hanft
  General Counsel and Chief Franchise Integrity Officer
  MasterCard Worldwide
  2000 Purchase Street
  Purchase, NY 10577
  (914) 249-2000

 

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APPENDIX D — Class Settlement Preliminary Approval Order

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

 

 

IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT DISCOUNT ANTITRUST LITIGATION

 

This Document Applies to: All Cases.

 

  

 

No. 05-MD-1720 (JG) (JO)

CLASS SETTLEMENT PRELIMINARY APPROVAL ORDER

WHEREAS, the Court has considered the Definitive Class Settlement Agreement, including its Appendices, dated as of                     , 2012 (the “Class Settlement Agreement”) among the Class Plaintiffs and the Defendants, which sets forth the terms and conditions for a proposed settlement of the Class Actions in MDL 1720, and the termination and disposition of all causes of action against the Defendants in those Class Actions with prejudice;

WHEREAS, the Court has considered the motion of Class Plaintiffs for preliminary approval of the Class Settlement Agreement, the Memorandum of Law and evidence filed in support thereof, the objections to preliminary approval of the Class Settlement Agreement and all evidence filed in support of such objections, and all other papers submitted in connection with the Class Settlement Agreement; and

WHEREAS, the Court held a hearing on                     , 201    , at which the Court heard argument on whether the Class Settlement Agreement should be preliminarily approved;

NOW, THEREFORE, IT IS HEREBY ORDERED AND DECREED as follows:

1. This Class Settlement Preliminary Approval Order incorporates by reference the definitions in the Class Settlement Agreement, and all terms herein shall have the same meanings as set forth in the Class Settlement Agreement.

 

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2. The Court has subject matter and personal jurisdiction over the Class Plaintiffs, all members of the settlement classes provisionally certified below, and the Defendants.

3. The Court preliminarily approves the Class Settlement Agreement, including specifically the Plan of Administration and Distribution contained in Appendix I of the Class Settlement Agreement, as within the range of a fair, reasonable, and adequate settlement within the meaning of Federal Rule of Civil Procedure 23 and applicable law, and consistent with due process.

4. The Court orders Class Counsel, the Visa Defendants, and the MasterCard Defendants to establish and maintain the Class Settlement Cash Escrow Account(s) and the Class Settlement Interchange Escrow Account(s) as provided in Paragraphs 6-8 of the Class Settlement Agreement, the Class Settlement Cash Escrow Agreement in Appendix B to the Class Settlement Agreement, and the Class Settlement Interchange Escrow Agreement in Appendix C to the Class Settlement Agreement.

5. Based on and pursuant to the class action criteria of Federal Rules of Civil Procedure 23(a) and 23(b)(3), the Court provisionally certifies, for settlement purposes only, a Rule 23(b)(3) Settlement Class, from which exclusions shall be permitted, consisting of all persons, businesses, and other entities that have accepted Visa-Branded Cards and/or MasterCard-Branded Cards in the United States at any time from January 1, 2004 to the Settlement Preliminary Approval Date, except that this Class does not include the named Defendants, their directors, officers, or members of their families, financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time from January 1, 2004 to the Settlement Preliminary Approval Date, or the United States government.

 

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6. Based on and pursuant to the class action criteria of Federal Rules of Civil Procedure 23(a) and 23(b)(2), the Court provisionally certifies, for settlement purposes only, a Rule 23(b)(2) Settlement Class, from which exclusions shall not be permitted, consisting of all persons, businesses, and other entities that as of the Settlement Preliminary Approval Date or in the future accept any Visa-Branded Cards and/or MasterCard-Branded Cards in the United States, except that this Class shall not include the named Defendants, their directors, officers, or members of their families, financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time since January 1, 2004, or do so in the future, or the United States government.

7. The definitions of the proposed classes in the Operative Class Complaints are hereby amended to be the same as the settlement classes provisionally certified above.

8. In the event of termination of the Class Settlement Agreement as provided therein, certification of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class shall automatically be vacated and each Defendant may fully contest certification of any class as if no Rule 23(b)(3) Settlement Class or Rule 23(b)(2) Settlement Class had been certified.

9. The Court finds and concludes that the Class Plaintiffs will fairly and adequately represent and protect the interests of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, and appoints them to serve as the representatives of those Settlement Classes. Based on and pursuant to the criteria of Federal Rule of Civil Procedure 23(g), the Court appoints the law firms of Robins, Kaplan, Miller & Ciresi L.L.P., Berger & Montague, P.C., and Robbins Geller Rudman & Dowd LLP to serve as Class Counsel.

 

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10. The notice requirements of the Class Action Fairness Act, 28 U.S.C. § 1715, have been met.

11. The Court appoints Epiq Systems, Inc. as the Class Administrator to assist Class Counsel in effectuating and administering the Notice Plan delineated in Appendix E to the Class Settlement Agreement and the exclusion process for Opt Outs, in analyzing and evaluating the amount of the Class Exclusion Takedown Payments and the Default Interchange Payments, and in effectuating and administering the claims process for members of the Rule 23(b)(3) Settlement Class.

12. The Court determines that notice should be provided to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, but that exclusion rights should be afforded only to members of the Rule 23(b)(3) Settlement Class as to their participation in the Rule 23(b)(3) Settlement Class.

13. The Court approves the method of notice to be provided to the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class that is described in the Class Settlement Agreement and in the Notice Plan contained in Appendix E to the Class Settlement Agreement, including use of the long-form website and mail notice and the publication notice contained in Appendix F to the Class Settlement Agreement. The Court finds and concludes that such notice: (a) is the best notice that is practicable under the circumstances, and is reasonably calculated to reach the members of the Rule 23(b)(3) Settlement Class and Rule 23(b)(2) Settlement Class that would be bound by the Class Settlement Agreement and to apprise them of the Action, the terms and conditions of the Class Settlement Agreement, their right to opt out and be excluded from the Rule 23(b)(3) Settlement Class, and to object to the Class Settlement Agreement; and (b) meets the requirements of Federal Rule of Civil Procedure 23 and due process.

 

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14. Consistent with the Notice Plan, the Court directs the Class Administrator, as soon as practicable following the Court’s entry of this Class Settlement Preliminary Approval Order, but before commencement of the mail and publication notice, to establish the dedicated Case Website, post office box, and toll-free telephone line for providing notice and information to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, and receiving exclusion requests from members of the Rule 23(b)(3) Settlement Class.

15. Within ninety days following the Court’s entry of this Class Settlement Preliminary Approval Order, the Class Administrator shall complete the mail and publication notice to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class that is described in the Notice Plan, using the long form mail notice and the publication notice contained in Appendix F to the Class Settlement Agreement.

16. As explained in the long-form notice and publication notice, any member of the Rule 23(b)(3) Settlement Class that does not wish to participate in the Rule 23(b)(3) Settlement Class shall have until one hundred eighty days after the Court’s entry of this Class Settlement Preliminary Approval Order — i.e., ninety days after the last date for completion of the mail and publication notice (the “Class Exclusion Period”) — to submit a request to become an Opt Out and be excluded from the Rule 23(b)(3) Settlement Class.

17. A member of the Rule 23(b)(3) Settlement Class may effect such an exclusion by sending a written request to the Class Administrator, by first-class mail with postage prepaid and postmarked within the Class Exclusion Period. The written request must be signed by a person authorized to do so, and provide all of the following information:

(a) The words “In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation.”

 

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(b) A statement of the Rule 23(b)(3) Settlement Class member’s full name, address, telephone number, and taxpayer identification number.

(c) A statement that the Rule 23(b)(3) Settlement Class member desires to be excluded from the Rule 23(b)(3) Settlement Class, and by what position or authority he or she has the power to exclude the member from the Rule 23(b)(3) Settlement Class.

(d) The business names, brand names, and addresses of any stores or sales locations whose sales the Rule 23(b)(3) Settlement Class member desires to be excluded from the Rule 23(b)(3) Settlement Class.

18. As also explained in the long-form notice and publication notice, any Rule 23(b)(3) Settlement Class member that does not submit a request for exclusion, or any Rule 23(b)(2) Settlement Class member, shall have until one hundred eighty days after the Court’s entry of the Class Settlement Preliminary Approval Order — i.e., ninety days after the last date for completion of the mail and publication notice (the “Class Objection Period”) — to submit an objection to the Class Settlement Agreement, any request for Attorneys’ Fee Awards, any request for Expense Awards, or any request for Class Plaintiffs’ Awards (be an “Objector”), and to file any notice to appear.

19. Such an Objector must file a written statement of objections with the Court within the Class Objection Period, and send it to the following designees of Class Counsel and counsel for the Defendants, by first-class mail and postmarked within the Class Objection Period:

Designee of Class Counsel: Alexandra S. Bernay, Robbins Geller Rudman & Dowd LLP, 655 West Broadway, Suite 1900, San Diego, California 92101-3301.

Designee of Defendants: Wesley R. Powell, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019.

20. The Objector’s written statement of objections must: (a) contain the words “In re Interchange Fee and Merchant Discount Antitrust Litigation”; (b) state each and every objection

 

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of the Objector and the specific reasons therefor; (c) provide all legal support and all evidence that the Objector wishes to bring to the Court’s attention in support of any objection; (d) state the full name and address and telephone number of the Objector; (e) provide information sufficient to establish that the Objector is a member of the Rule 23(b)(3) Settlement Class and/or the Rule 23(b)(2) Settlement Class; and (f) state the full name, mail address, email address, and telephone number of any counsel representing the Objector in connection with the objections.

21. In addition, any Objector or counsel for an Objector that desires to appear at the final approval hearing must file with the Court within the Class Objection Period, and send to the designees of Class Counsel and the Defendants identified above, by first class mail and postmarked within the Class Objection Period, a separate notice of intention to appear that identifies by name, position, address, and telephone number each person who intends to appear at the final approval hearing on behalf of the Objector.

22. Prior to forty five days before the end of the Class Exclusion Period and Class Objection Period — i.e., within one hundred thirty five days after the Court’s entry of this Class Settlement Preliminary Approval Order — Class Counsel will file all motion and supporting papers seeking the Court’s final approval of the Class Settlement Agreement, and the Court’s approval of any Attorneys’ Fee Awards, Expense Awards, or Class Plaintiffs’ Awards with respect to any Class Action in MDL 1720. Class Counsel will also file any additional details regarding the Plan of Administration and Distribution, after timely and regular consultation with the Defendants and subject to the Court’s approval, prior to forty-five days before the end of the Class Exclusion Period and Class Objection Period. Class counsel will provide notice of such motions and any additional details to members of the Rule 23(b)(3) Settlement Class and to members of the Rule 23(b)(2) Settlement Class by causing all such motions and supporting

 

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papers, and any additional details regarding the Plan of Administration and Distribution, to be posted prominently on the Case Website prior to, or simultaneously with, their filing with the Court.

23. Within one hundred ninety-five days after the Court’s entry of the Class Settlement Preliminary Approval Order — i.e., within fifteen days after the conclusion of the Class Exclusion Period — the Class Administrator shall prepare a report, and file it with the Court and provide it to the following designees of Class Counsel, the Visa Defendants, the MasterCard Defendants, and the Bank Defendants:

Designee of Class Counsel: Alexandra S. Bernay, Robbins Geller Rudman & Dowd LLP, 655 West Broadway, Suite 1900, San Diego, California 92101-3301.

Designee of Visa Defendants: Matthew A. Eisenstein, Arnold & Porter LLP, 555 Twelfth Street, NW, Washington, DC 20004.

Designee of MasterCard Defendants: Wesley R. Powell, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019.

Designee of Bank Defendants: Peter E. Greene, Skadden, Arps, Slate, Meagher & Flom LLP, Four Times Square, New York, NY 10036.

24. The Class Administrator’s report shall:

(a) Confirm that the Notice Plan was carried out and that the website notice, mail notice, publication notice, and any other notice to members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class was provided in the manner directed by the Court.

(b) Identify the date when the Case Website was fully established and its content made available to the members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, the date or dates on which mail notices were mailed, the dates of the publication notices, and the date or dates of any other notice directed by the Court.

(c) List each member of the Rule 23(b)(3) Settlement Class that sought to become an Opt Out and be excluded from the Rule 23(b)(3) Settlement Class, and on what date

 

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the request to be excluded was postmarked and received, and state whether the Rule 23(b)(3) Settlement Class member’s request for exclusion was timely and properly made.

(d) Attach a copy of all documentation concerning each request for exclusion that the Class Administrator received, with any taxpayer identification number, or other confidential information filed under seal with the Court.

25. As provided in the Class Settlement Agreement, within approximately two hundred forty days after the Court’s entry of the Class Settlement Preliminary Approval Order, in the event that the Class Plaintiffs and the Defendants have not resolved all differences regarding the amount of the Class Exclusion Takedown Payments to be made to the Visa Defendants and the MasterCard Defendants, they shall submit their dispute to the Court for resolution in connection with the final approval hearing, so that the Court’s Class Settlement Order and Final Judgment may identify each Opt Out and state the Class Exclusion Takedown Payments to be made, respectively, to the Visa Defendants and to the MasterCard Defendants from the Class Settlement Cash Escrow Account(s) as provided in the Class Settlement Agreement.

26. The Class Administrator’s expenses for the foregoing notice and exclusion activities, including those of any third-party vendors it uses to perform tasks necessary for the implementation or effectuation of its duties, shall be paid from the Class Settlement Cash Escrow Account(s). In no event shall any Defendant, Rule 23(b)(3) Settlement Class Released Party, or Rule 23(b)(2) Settlement Class Released Party have any obligation, responsibility, or liability with respect to the Class Administrator, the Notice Plan, or the exclusion procedures for members of the Rule 23(b)(3) Settlement Class, including with respect to the costs, administration expenses, or any other charges for any notice and exclusion procedures.

 

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27. The Court will hold a final approval hearing at least two hundred eighty five days after the Court’s entry of this Class Settlement Preliminary Approval Order, at     o’clock on                          , 2013, at the Courthouse for the United States District Court for the Eastern District of New York, 225 Cadman Plaza East, Brooklyn, NY 11201. At that final approval hearing, the Court will conduct an inquiry as it deems appropriate into the fairness, reasonableness, and adequacy of the Class Settlement Agreement, address any objections to it, and determine whether the Class Settlement Agreement and the Plan of Administration and Distribution should be finally approved, whether final judgment should be entered thereon, and whether to approve any motions for Attorneys’ Fee Awards, Expense Awards, and Class Plaintiffs’ Awards.

28. The Court stays all further proceedings in this Action as between the Class Plaintiffs or any other plaintiff in a putative class action consolidated in MDL 1720, and the Defendants or any other defendant in a putative class action consolidated in MDL 1720, except for proceedings in MDL 1720 related to effectuating and complying with the Class Settlement Agreement, pending the Court’s determination of whether the Class Settlement Agreement should be finally approved or the termination of the Class Settlement Agreement.

29. The Court enjoins the members of the Rule 23(b)(3) Settlement Class and the Rule 23(b)(2) Settlement Class, pending the Court’s determination of whether the Class Settlement Agreement should finally be approved or the termination of the Class Settlement Agreement, from challenging in any action or proceeding any matter covered by this Class Settlement Agreement or its release and covenant not to sue provisions, except for (a) proceedings in MDL 1720 related to effectuating and complying with the Class Settlement Agreement; and (b) any Opt Out’s claims for damages based on any conduct, acts, transactions, events, occurrences, statements, omissions, or failures to act of any Rule 23(b)(3) Settlement

 

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Class Released Party prior to the date of the Court’s entry of this Class Settlement Preliminary Approval Order.

 

IT IS SO ORDERED.      
DATED:  

 

     

 

        THE HONORABLE JOHN GLEESON
        UNITED STATES DISTRICT JUDGE

 

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APPENDIX E — Notice Plan

 

LOGO

In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation Settlement Notice Plan

Hilsoft Notifications

 

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Table of Contents

 

 

 

          Page  

1.

   Introduction      4   

2.

   Overview/Summary      5   

3.

   Notice Schedule Flow Chart      10   

4.

   Target Audience      11   

5.

   Individual Mailed Notice      13   

6.

   Media Selection      15   

7.

   Plan Delivery Summary      17   

8.

   Net Reach      18   

9.

   Average Frequency of Exposure      20   

10.

   Geographic Coverage      21   

11.

   Nationwide Publication Plan      23   

12.

   Nationwide Publication Details      24   

13.

   Nationwide Publication Coverage      26   

14.

   Nationwide Publication Circulation      27   

15.

   Publication Secondary Reader Data      28   

16.

   Nationwide Publication Audience Data      29   

17.

   Nationwide Publication Gross Impressions      30   

18.

   National Business Publication Plan      31   

19.

   National Business Publication Circulation      32   

 

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20.

     National Business Publication Secondary Reader Data      33   

21.

     National Business Publication Audience Data      34   

22.

     Trade, Business & Specialty Publications      35   

23.

     Language & Ethnic Targeted Publications      38   

24.

     U.S. Territories Newspapers      45   

25.

     Internet Banner Notices      46   

26.

     Informational Release      47   

27.

     Case Website      48   

28.

     Toll-Free Telephone Support Line and Post Office Box      51   

29.

     Sponsored Search Listings      52   

30.

     Notice Design Strategy      53   

31.

     Notices      54   

Attachment 1Hilsoft Notifications Curriculum Vitae

  

Attachment 2Parade and USA Weekend Newspaper List

  

Attachment 3Informational Release

  

 

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1. Introduction

 

 

The “Notice Plan” (or “Plan”) that follows details the dissemination effort that will be undertaken to provide comprehensive notice to Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members in connection with the proposed Settlement in In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation — MDL No. 1720(JG)(JO). The Plan is based on meeting key objectives and utilizes extensive and appropriate prior class action notice experience.

Hilsoft Notifications has designed and will implement this Notice Plan. With experience in more than 200 cases, Hilsoft Notifications’ notices have appeared in 53 languages with distribution in almost every country, territory and dependency in the world. Courts, including in published decisions, have recognized and approved numerous Hilsoft settlement notice plans. Key Hilsoft Notifications principals Cameron Azari, Esq., Director of Legal Noticing, and Lauran Schultz, Executive Director, have designed the Plan, and will oversee implementation to successful completion. Hilsoft Notifications’ curriculum vitae, including judicial comments recognizing notice expertise and approved plans, is attached as Attachment 1.

The proposed long-form Notice of Settlement of Class Action (“Long-Form Notice”) and Publication Notice (together, the “Notice” or “Notices”) were drafted pursuant to the Definitive Class Action Settlement Agreement (“Class Settlement Agreement”) by Class Counsel with the assistance of Hilsoft and an independent plain-language expert Maria Mindlin. Ms. Mindlin’s expertise focuses on language proficiency and readability. She has provided plain-language instruction and services to numerous courts and attorneys. In addition, settlement notices which she has assisted in drafting have been approved by courts. The Notices were written and designed to embody the satisfaction of the plain language requirements of Federal Rule of Civil Procedure 23(c)(2).

 

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2. Overview/Summary

 

 

 

 

Objective. To notify the greatest practicable number of Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members and provide them with opportunities to be exposed to the Notice, to see, review, understand, and be reminded about it, and to respond appropriately if they choose.

 

 

Imperatives. Key factors guide the dissemination methods needed to achieve a reasonable and effective notice effort:

 

  1. The proposed Rule 23(b)(3) Settlement Class and Rule 23(b)(2) Settlement Class are national in scope and likely include persons of all ages, races and demographic profiles.

 

  2. Data containing contact information for members of both settlement classes supplied by the defendants and potentially cross-referenced with lists subpoenaed from other sources is available. Some data may be available for the entire Class Period.

 

  3.

A high number of small businesses fail annually and locating current addresses for these class members is not certain.1

 

  4.

Many small retail businesses are owned and operated by recent immigrants and members of discreet, ethnic and foreign-language communities.2

 

  5. High quality notice methods are needed to convey the importance of information affecting the rights of both Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members.

 

 

Target Audience. We understand that the Class Settlement Agreement defines two Classes (the “Class Definitions”):

Rule 23(b)(3) Settlement Class. All persons, businesses, and other entities that have accepted Visa-Branded Cards and/or MasterCard-Branded Cards in the United States at any time from January 1, 2004 to the Settlement Preliminary Approval Date, except that this Class does not include the named Defendants, their directors, officers, or members or their families,

 

1 

According to the 2011 U.S. Business Trends Report done by Dun & Bradstreet, “In the 12 months ending in September 2010, there were 81,616 business failures — 41% more than the official bankruptcies reported by the U.S. Government.” Source http://www.dnbgov.com/pdf/US_Business_Trends_Jan11.pdf (last checked 9/12/12).

2 

According to the 2007 Survey of Business Owners survey done by the United States Census Bureau, there were approximately 1.9 million African-American owned businesses, 1.5 million Asian owned businesses and 2.3 million Hispanic owned businesses in the United States. Source http://www.census.gov/econ/sbo/ (last checked 7/23/12).

 

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financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time from January 1, 2004 to the Settlement Preliminary Approval Date, or the United States government;

and

Rule 23(b)(2) Settlement Class. All persons, businesses, and other entities that as of the Settlement Preliminary Approval Date or in the future accept any Visa-Branded Cards and/or MasterCard-Branded Cards in the United States, except that this Class shall not include the named Defendants, their directors, officers, or members of their families, financial institutions that have issued Visa- or MasterCard-Branded Cards or acquired Visa- or MasterCard-Branded Card transactions at any time since January 1, 2004, or do so in the future, or the United States government.

We further understand that the capitalized terms in the Class Definitions have the following meanings:

 

   

“MasterCard-Branded Card” means any Credit Card or Debit Card that bears or uses the name MasterCard, Maestro, Cirrus, or any other brand name or mark owned or licensed by a MasterCard Defendant, or that is issued under any such brand or mark.

 

   

“Visa-Branded Card” means any Credit Card or Debit Card that bears or uses the name Visa, Plus, Interlink, or any other brand name or mark owned or licensed for use by a Visa Defendant, or that is issued under any such brand or mark.

To verify the notice program’s effectiveness, GfK Mediamark Research & Intelligence, LCC (“MRI”)3 data was studied among: (1) all adults aged 18 years and older; (2) all business owners; and (3) all business financial decision makers. This data formed the basis for the media program.

 

3 

GfK Mediamark Research & Intelligence, LCC (“MRI”) is a leading source of publication readership and product usage data for the communications industry. MRI offers comprehensive demographic, lifestyle, product usage and exposure to all forms of advertising media collected from a single sample. As the leading U.S. supplier of multimedia audience research, MRI provides information to magazines, televisions, radio, Internet, and other media, leading national advertisers, and over 450 advertising agencies — including 90 of the top 100 in the United States. MRI’s national syndicated data is widely used by companies as the basis for the majority of the media and marketing plans that are written for advertised brands in the U.S.

 

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Strategies. The Long-Form Notice will be mailed to known, likely Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members, compiled from various lists provided by the settling defendants and the largest bank acquirers and processors. In addition, an extensive schedule of media placements has been developed to reach both settlement classes’ members across the United States through dissemination of the Publication Notice. The schedule includes well-read consumer magazines, national business publications, Sunday local newspapers (via newspaper supplements), and highly trafficked websites. Although not measurable, placements of the Publication Notice will also appear in trade, business & specialty publications, language & ethnic targeted publications, and U.S. territories newspapers. To ensure readability, the Publication Notice shall appear in display rather than classified advertisements, and in at least 9 point font. An informational release and Case Website will provide additional notice exposures.

 

 

Delivery. The combined measurable effort will reach an estimated 80.2% of all U.S. adults on average 2.6 times each, an estimated 80.3% of all business owners on average 2.7 times each, and an estimated 81.7% of all business financial decision makers on average 2.7 times each. The “reach” or net reach of a notice program is defined as the percentage of the target audience exposed to a Notice net of any duplication among people who may have been exposed more than once. Coverage will be further enhanced by media placements described above for which reach is not measured. The measurable reach and frequency that will be achieved is consistent with other effective court-approved notice programs, and is designed to meet due process requirements.

 

 

Notice Tactics. The following notice tactics have been selected to best reach Class Members:

 

  1. Individual Mailed Notice. For all Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members, for whom name and address data can be ascertained with reasonable effort, a Notice Packet, containing a the Long-Form Notice will be mailed via first class mail. Appropriate address updating procedures will be implemented pre-mail and on returned undeliverables.

 

  2.

Sunday Newspaper Inserts. In order to achieve broad, national exposure of the notice, the Publication Notice will appear once in over 1,200 Sunday newspapers nationwide via Parade Magazine and USA Weekend.

 

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  Parade Magazine and USA Weekend have a combined circulation of over 55 million.

 

  3. Consumer Publications. The Publication Notice will appear in five leading weekly and monthly consumer publications — two times each in People, TV Guide, and Sports Illustrated, and once in National Geographic, and People en Espanol, for a total of eight insertions. The selected consumer publications have a combined circulation of approximately 13.5 million.

 

  4. National Business Publications. To achieve broad, national exposure of the settlement among the professional business community, the Publication Notice will appear once in the Wall Street Journal, Financial Times, New York Times, Investor’s Business Daily, Barron’s, Forbes, Fortune, and Bloomberg BusinessWeek, for a total of eight insertions.

 

  5. Trade & Specialty Publications. In order to reach the general business community through their local business media, the Publication Summary Notice will appear one or two times in 72 trade & specialty publications, targeting business owners and business financial decision covering every major metropolitan area in the country, for a total of 140 insertions. Combined, the trade & specialty publications provide a total circulation of over one million. The trade, business and specialty publications have a combined circulation of approximately seven million.

 

  6. Language & Ethnic Targeted Publications. To better reach small, retail business owners for whom English is not their primary language, or who rely on publications specifically directed to their community, the Publication Notice will appear two times in selected daily or weekly publications and one time in selected monthly publications. The Publication Notice will be translated into Spanish, Chinese, Japanese, Korean, Russian, Thai, and Vietnamese where appropriate. The 163 selected publications have a combined circulation of over 6.5 million.

 

  7. U.S. Territories Newspapers. The Summary Notice will appear in the following newspapers targeting the U.S. territories — Caribbean Business, El Nuevo Día, El Vocero De Puerto Rico, Primera Hora, Agana Pacific Daily News, Saipan Tribune, Samoa News, St. Croix Avis, St. John Trade Winds, and The Virgin Island Daily News.

 

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  8. Internet Banner Notices. Banner Notices measuring 728 x 90 pixels and 300 x 250 pixels will be placed during a one-month period on national web properties such as 24/7 Real Media (a network that represents over 900 websites), Facebook, Yahoo!, MSN, AOL, Washingtonpost.com, and National Network of Business Journal Websites. Combined, approximately 136 million adult impressions will be generated by these banners over a one-month period. These Internet Banner Notices will link to the Case Website.

 

  9. Informational Release. A party-neutral, informational release will be issued to approximately 4,200 print and broadcast and 5,500 online press outlets throughout the United States.

 

  10. Sponsored Search Listings. Sponsored search listings will be acquired on the three most highly visited Internet search engines: Google, Yahoo! and Bing.

 

  11. Case Website. A neutral case notice website with an easy to remember domain name will be established where class members can obtain additional information about the case and obtain notice documents, including the Long-Form Notice.

 

  12. Toll-Free Telephone Support Line and Post-Office Box. A toll-free telephone line for providing information to class members and a post office box for receiving requests for information from class members.

 

 

Message Content. The Notices have been designed to provide a clear, concise, plain language statement of the legal rights and options of Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members. The Notices alert such class members that the message may affect them. The Publication Notice includes a summary of the terms of the Class Settlement Agreement. Drafts of the Notices are attached as Exhibit F to the Class Settlement Agreement.

 

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3. Notice Schedule Flow Chart

 

 

The chart below shows a hypothetical schedule. This schedule would allow for completion of the Notice Plan within 90 days after the Court’s entry of the Class Settlement Preliminary Approval Order. The website will remain operational beyond the flowchart shown, until requested to be terminated.

 

Notice Tactic

   Week
1
   Week
2
   Week
3
   Week
4
   Week
5
   Week
6
   Week
7
   Week
8
   Week
9
   Week
10
   Week
11
   Week
12

Preliminary Approval Granted

                                   

Issue Informational Release

                                   

Individual Notice Mailing

                                   

Internet Banner Notices

                                   

National Newspaper Inserts

                                   

National Consumer Publications

                                   

Trade, Business, Specialty Publications

                                   

Language & Ethnic Targeted Publications

                                   

Newspapers Targeting U.S. Territories

                                   

Case Website

                                   

Note: Print media blocks show when readers first receive publications (the on-sale date). Media selections are subject to change by addition, deletion, or substitution at the time of placement. Appearance dates may vary within the notice period, based on availability at the time of placement.

 

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4. Target Audience

 

 

The demographics of the class, including, but not limited to, those most likely to be class members.

The proposed Rule 23(b)(3) Settlement Class and Rule 23(b)(2) Settlement Class are national in scope and likely include persons of all ages, races and demographic profiles. Data on business owner and business financial decision makers were specifically analyzed to identify key demographic groups, which can be used to guide media selection.

To ensure the greatest possible coverage of measured media in reaching the potentially diverse universe of members of both settlement classes, the Notice Plan has a primary target audience of all adults 18 years and older across the country. Additionally, the media is targeted to reach individuals who might own their own business, have owned a business in the past, or make financial decisions for their business with secondary targets of “business owners” and “business financial decision makers.”

According to MRI, demographic highlights for all three categories include the following:

 

Demographic

   Adults
18+
    Business
Owners
    Business
Financial
Decision Makers
 

Percentage that are men

     48.4     64.9     61

Percentage that are women

     51.6     35.1     39

Percentage that are between the ages of 45-54

     19.5     28.3     29

Percentage that work full-time

     48.3     70.8     83.5

Percentage that work part-time

     11.9     29.2     16.5

Percentage that graduated from college

     27.1     32.2     45.3

Percentage that have an individual employment income of $100,000+

     5.5     15.5     24.8

Percentage that own a home

     70.3     78.4     83.9

Percentage that lived at their residence five or more years

     56.1     60.7     63.1

Percentage that are white

     76.3     83.2     88.3

Percentage that are African-American

     11.6     7.3     5.5

 

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Percentage that are Asian

     3     2.6     2.7

Using MRI data we can also pinpoint certain key demographics that make up a greater percentage of Business Owner and Business Financial Decision Makers nationwide, relative to the general U.S. adult population as set forth:

 

Demographic

   Business
Owners
    Business
Financial
Decision Makers
 

Percent more likely to be men

     34.2     26.2

Percent more likely to be between the ages of 45-54

     44.9     48.9

Percent more likely to work full-time

     46.6     72.8

Percent more likely to have graduated from college

     19     67.4

Percent more likely to own a home

     11.5     19.4

Percent more likely to have lived at their residence five or more years

     8.3     12.4

Percent more likely to be white

     9     15

 

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5. Individual Mailed Notice

 

 

Reaches class members directly with notice by mail.

For all Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members, for whom name and address data can be ascertained with reasonable effort, the Long-Form Notice will be mailed via first class mail. Potential class members will be directed to the settlement website — www.PaymentCardSettlement.com — and the toll-free number for information regarding the Settlement.

We understand that the mailing list will be compiled from multiple datasets including:4

 

   

Certain merchant contact information maintained by the 25 largest Acquirers and Processors, which includes Bank of America Merchant Services, Chase Paymentech Solutions, SunTrust Merchant Services, Wells Fargo Bank, N.A. (through Wells Fargo Merchant Services), Vantiv (f.k.a. Fifth Third Merchant Services). These entities handle more than 90% of Visa and MasterCard transaction sales volume as reported in Nilson Report 990 (March 2012).

 

   

Certain Visa databases.

 

   

Certain MasterCard databases.

Prior to mailing, reasonable efforts will be used to eliminate exact duplicate entries from the available data sources. Subsequently, all addresses will be checked against the National Change of Address (“NCOA”) database maintained by the United States Postal Service (“USPS”).5 If a record is returned by NCOA as invalid, the Class Administrator will update the address through third-party address search services and re-mail as appropriate. Notices returned as undeliverable will be re-mailed to any new address available through postal service information, for example, to the address provided by the postal service on returned pieces for which the automatic forwarding order has expired, but which is still during the period in which the postal service returns the piece with the address indicated, or to better

 

4 

Pursuant, to Paragraph 81(d) of the Class Settlement Agreement, “Class Plaintiffs shall subpoena, to obtain the names and locations of any members of the Rule 23(b)(3) Settlement Class or the Rule 23(b)(2) Settlement Class, as many non-Bank Defendant acquirers as would be necessary to attempt to obtain merchant name and location information attributable to more than 90% of merchant transaction volume and 90% of merchant outlets as reported in Nilson Report 990 (March 2012).”

5 

The NCOA database contains records of all permanent changes of address submissions received by the USPS for the last four years. The USPS makes this data available to mailing firms and lists submitted to it are automatically updated with any reported move based on a comparison with the person’s name and known address.

 

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addresses that may be found after reasonable, additional third-party source lookups. Upon successfully locating better addresses, Notices will be promptly re-mailed on an ongoing basis.

Additionally, the Long-Form Notice will be mailed to all persons who request one via the toll-free phone number maintained by the Class Administrator.

 

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6. Media Selection

 

 

The media vehicles that will best reach class members in this particular notice program.

In addition to mailing the Long-Form Notice, a comprehensive national multi-media effort has been selected to effectively deliver a clear message to Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members. A broad, national media effort is essential since it is unknown whether it will be possible to determine accurate addresses for representatives of the high number of businesses that have closed or changed locations during the Class Period (address updating resources for businesses are not as reliable as resources available for determining the current address of individuals). Because of these unknowns, and due to the significance of the settlement, a substantial media effort is necessary.

Broad, national exposure will be achieved by placement of the Publication Notice in Sunday newspapers nationwide via Parade Magazine and USA Weekend and via five leading weekly and monthly consumer publications — most read by business owners and business financial decision makers. Broad, national exposure among the professional business community will be achieved by placing the Publication Notice in leading national business publications. The general business community will be targeted by placing the Publication Notice in local business journal publications in virtually every major market in the U.S. Retail business owners for whom English is not their primary language, or who rely on publications specifically directed to their community, will be targeted by placing the Publication Notice in language & ethnic targeted publications. Businesses in the U.S. territories will be targeted by placing the Publication Notice in newspapers published in U.S. territories as well as spill-over circulation from consumer publications.

We have reviewed the merits of all forms of media and, based on our analysis, our media selection allows:

 

 

A large majority of members of both settlement classes to be reached by the measurable paid print, and online media alone (at least 80.2% of all U.S. adults, 80.3% of all business owners, and an estimated 81.7% of all business financial decision makers).

 

 

Multiple opportunities for members of both settlement classes to see the message through overlapping reach of the different notice methods.

 

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“Noticeable” Publication Notices in leading consumer magazines, and other publications that will allow readers to have a written record and the ability to refer back to the Notice, pass it on to others, and easily respond via the website or toll-free number.

 

 

Placement of the Publication Notice in approximately 1,213 newspapers nationwide via Parade, and USA Weekend, which are inserted in the weekend editions of newspapers with distribution in large cities and small towns.

 

 

Placement of the Publication Notice in appropriate business and trade publications targeting business owners and business financial decision makers.

 

 

Placement of the Publication Notice in appropriate foreign language publications covering major ethnic groups identified to target business owners and business financial decision makers.

 

 

Placement of the Publication Notice in daily newspapers with distribution in U.S. territories.

 

 

Extended reach via rotating Internet Banner Notices on a variety of web properties.

 

 

The broadest, most inclusive national coverage as well as targeted business coverage, ensuring that Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members are not excluded.

 

 

The broadest, most-inclusive demographic coverage, ensuring that Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members are effectively reached through notice placements in a variety of cultural and trade publications.

 

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7. Plan Delivery Summary

 

 

 

National Consumer Publications

     5   

Newspapers carrying Notices (via supplements):

     1,213   

National Business Publications

     8   

Trade Publications

     72   

Language & Ethnic Targeted Publications

     163   

Total Print Insertions

     1,688   

Internet Banner Notices

     136 million   

U.S. Territories Newspaper Placements:

     10   

U.S. Territories Newspaper Circulation:

     568,760   

Estimated Net % Reached — Adults 18+

     80.2

Avg. Frequency of Exposure — Adults 18+

     2.6 times   

Estimated Net % Reached — Business Owners

     80.3

Avg. Frequency of Exposure — Business Owners

     2.7 times   

Estimated Net % Reached — Business Financial Decision Makers

     81.7

Avg. Frequency of Exposure — Business Financial Decision Makers

     2.7 times   

Estimated Net Audience — National

     249,458,200   

Estimated Gross Impressions* — National

     328,702,200   

Source: 2011 MRI Doublebase Study, ABC and publication circulation statements.

 

* Total exposures to notice among all those exposed, including repeat exposures.

 

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8. Net Reach

 

 

Total different persons who open or read a publication containing a notice.

We employ industry-standard computer software, which uses the latest readership data to factor out the duplicate persons reached by the different and overlapping audiences on a notice schedule to yield total net persons reached. The proposed measurable print and online efforts are estimated to reach:

 

Target

   % Reached, Net
of Duplication
 

All U.S. Adults Aged 18+

     80.2

Business Owners

     80.3

Business Financial Decision Makers

     81.7

Source: 2011MRI Doublebase Study, Nielson, Arbitron, comScore.

Reach will most certainly be further enhanced by the Long-Form Notice mailing effort, placements of the Publication Notice in trade, business, specialty publications, language & ethnic targeted publications, newspapers targeting U.S. territories, the informational release, and Case Website.

The audience data used to determine these results are the same data used by media professionals to guide the billions of dollars of advertising we see today. The statistics and sources we cite are uniformly relied upon in our field: Audit Bureau of Circulations (“ABC”) data has been relied upon since 1914;6 90%-100% of media directors use reach and frequency planning;7 all of the leading advertising and communications textbooks cite the need to use reach and frequency planning;8

 

6  Established in 1914, ABC is a non-profit cooperative formed by media, advertisers, and advertising agencies to audit the paid circulation statements of magazines and newspapers. ABC is the leading third-party auditing organization in the U.S. It is the industry’s leading neutral source for documentation on the actual distribution of newspapers printed and bought by readers. Widely accepted throughout the industry, it certifies over 3,000 publications, categorized by metro areas, region, and other geographical divisions. Its publication audits are conducted in accordance with rules established by its Board of Directors. These rules govern not only how audits are conducted, but also how publishers report their circulation figures. ABC’s Board of Directors is comprised of representatives from the publishing and advertising communities.
7  See generally Peter B. Turk, Effective Frequency Report: Its Use And Evaluation By Major Agency Media Department Executives, 28 J. ADVERTISING RES. 56 (1988); Peggy J. Kreshel et al., How Leading Advertising Agencies Perceive Effective Reach and Frequency, 14 J.ADVERTISING 32 (1985).
8 

Textbook sources that have identified the need for reach and frequency for years include: JACK S. SISSORS & JIM SURMANEK, ADVERTISING MEDIA PLANNING, 57-72 (2d ed. 1982); KENT M. LANCASTER & HELEN E. KATZ, STRATEGIC MEDIA PLANNING 120-156 (1989); DONALD W. JUGENHEIMER & PETER B. TURK, ADVERTISING MEDIA 123-126 (1980); JACK Z. SISSORS & LINCOLN BUMBA, ADVERTISING MEDIA PLANNING 93-122 (4th ed. 1993); JIM SURMANEK, INTRODUCTION TO ADVERTISING MEDIA: RESEARCH, PLANNING, AND BUYING 106-187 (1993).

 

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and a leading treatise says it must be used:9 “In order to obtain this essential information, we must use the statistics known as reach and frequency.” Ninety of the top one hundred media firms use MRI data, which has a 95% confidence interval; and at least 3,000 media firms in 25 different countries use media planning software for reach and frequency planning.10 Online media planning data is provided by comScore, Inc.11

 

9 

AMERICAN ADVERTISING AGENCY ASSOCIATION, GUIDE TO MEDIA RESEARCH 25 (1987), revised 1993.

10 

For example, Telmar is the world’s leading supplier of media planning software and support services. Over 3,000 users in 25 countries, including 95% of the world’s top agencies, use Telmar systems for media and marketing planning tools including reach and frequency planning functions. Established in 1968, Telmar was the first company to provide media planning systems on a syndicated basis.

11 

comScore, Inc. is a global leader in measuring the digital world and a preferred source of digital marketing intelligence. In an independent survey of 800 of the most influential publishers, advertising agencies and advertisers conducted by William Blair & Company in January 2009, comScore was rated the “most preferred online audience measurement service” by 50% of respondents, a full 25 points ahead of its nearest competitor.

 

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9. Average Frequency of Exposure

 

 

Average number of times that each different person reached will have an opportunity to view a vehicle containing a notice placement.

This Notice Plan is intended to provide Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members with the best practicable opportunity to view and understand the Publication Notice and their rights, including a Rule 23(b)(3) Settlement Class member’s right to file a claim, if desired, or exclude itself from the Rule 23(b)(3) settlement. A by-product of the media vehicles necessary for a broad net reach is multiple exposures to notice from overlapping audience coverage.

This Notice Plan relies upon modern-style, audience-documented media coverage as reported herein, and provides a higher frequency of exposure than would a direct mail notice program that sends one notice, one time, to a class member.12 The average frequency of exposure resulting from the proposed Notice Program is as follows:

 

Target

   Average Frequency of
Exposure

All U.S. Adults Aged 18+

   2.6 times

Business Owners

   2.7 times

Business Financial Decision Makers

   2.7 times

Source: 2011 MRI Doublebase Study.

The frequency of exposure will be further enhanced by the Individual Mailed Notice effort, placements of the Publication Notice in trade, business and specialty publications, language & ethnic targeted publications, newspapers targeting U.S. territories, informational release, and Case Website.

 

12 

The reach achievable through direct mail notice programs varies widely depending on the accuracy and comprehensiveness of class member mailing lists.

 

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10. Geographic Coverage

 

 

Ensuring that class members are not excluded simply because of where they live.

Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members may reside anywhere in the U.S. or its territories and possessions; therefore, the Notice Plan has been designed to ensure fair and wide geographic coverage.

 

 

The consumer publications have distribution and/or subscribers throughout the U.S., as supported by the detailed ABC statements for each publication.

 

 

Parade and USA Weekend are distributed within nearly 1,213 newspapers nationwide, covering large markets as well as reaching deep into small towns.

 

 

The business newspapers have distribution and/or subscribers throughout the U.S.

 

 

Placements of the Publication Notice in trade, business and specialty publications extend reach to business owners and business financial decision makers throughout the U.S. The recommended consumer publications also offer circulation to business owners and business financial decision makers.

 

 

Placements of the Publication Notice in language & ethnic targeted publications will extend coverage to Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members residing throughout the U.S. to better reach small, retail business owners for whom English is not their primary language, or who rely on publications specifically directed to their community.

 

 

Placements of the Publication Notice in the largest circulation newspapers in each of the U.S. territories and possessions will extend coverage to Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members residing outside of the continental U.S. Additionally, the recommended consumer publications offer spillover circulation into the U.S. territories and possessions.

 

 

The Internet Banner Notices and Case Website allow access to the Notice regardless of geography.

 

 

The informational release will broaden the geographic coverage further.

 

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Accordingly, the Notice will reach Rule 23(b)(3) Settlement Class members and Rule 23(b)(2) Settlement Class members regardless of where they choose to live.

 

© 2012 Hilsoft Notifications

 

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11. Nationwide Publication Plan

 

 

The national newspaper supplements and consumer publications in which the notice will appear.

The Notice Plan includes multiple placements of the Publication Notice in leading weekly and monthly publications. Publication Notice will appear once in the national newspaper supplements Parade and USA Weekend. Combined, these publications appear in over 1,213 Sunday newspapers nationwide. A complete listing of the newspapers is provided in Attachment 2. Publication Notice will appear twice in People, TV Guide, Sports Illustrated, and once in National Geographic and People en Espanol (in Spanish), for a total of 10 insertions. The selected publications cover all demographic groups.

 

Publication

   Issuance    Notice Content    # of Insertions

Parade

   Weekly    Standard Magazine Unit    1

USA Weekend

   Weekly    Standard Magazine Unit    1

People

   Weekly    Full Page    2

National Geographic

   Monthly    Full Page    1

Sports Illustrated

   Weekly    Full Page    2

TV Guide

   Weekly    Full Page    2

People en Espanol

   10x/year    Full Page    1
        

 

TOTAL

   10
        

 

 

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12. Nationwide Publication Details

 

 

A summary of facts on the consumer publications in which the notice will appear.

 

Publication

       

Facts

Parade      Weekly national newspaper supplement covering family, food, health, current events and entertainment.
     Readership ranks 1st among Adults 18+
     Provides the single largest readership of any publication.
     Provides a broad demographic readership and geographic coverage.
     Carried in approximately 593 papers throughout the U.S.
     Planned notice size: Standard Magazine Unit
     Planned insertions: 1x
USA Weekend      Weekly national newspaper supplement covering family, food, health, current events and entertainment.
     Provides a broad demographic readership and geographic coverage.
     Carried in approximately 655 papers throughout the U.S.
     Planned notice size: Standard Magazine Unit
     Planned insertions: 1x
People      Weekly entertainment magazine featuring celebrity news, biographies, and gossip.
     Provides a large number of pass along readers.
     Planned notice size: Full-Page
     Planned insertions: 2x
National Geographic      Monthly publications featuring photos, maps and articles relating to animals, the environment, cultures and history around the world.
     Planned notice size: Full-Page
     Planned insertions: 1x
Sports Illustrated      Weekly sports magazine covering sports news, photos, scores, columns and expert analysis.
     Planned notice size: Full-Page
     Planned insertions: 2x

 

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TV Guide      Weekly targeted magazine featuring up-to-date breaking entertainment news and weekly television listings.
     Planned notice size: Full-Page
     Planned insertions: 2x
People en Espanol  

   10x/year entertainment magazine featuring celebrity news, biographies, and gossip in Spanish.
 

   Planned notice size: Full-Page
 

   Planned insertions: 1x

 

© 2012 Hilsoft Notifications

 

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13. Nationwide Publication Coverage

 

 

The size of the audience as a percent of the demographic base (reach).

The selected publications include the top three in the country, as well as publications that extend reach among various demographic segments.

 

     Coverage
Among
 

Publication

   U.S.
Adults
    Business
Owners
    Business Financial
Decisions Makers
 

Parade

     30.37     30.43     34.67

USA Weekend

     18.30     19.88     21.65

People

     19.87     17.06     21.58

National Geographic

     13.95     15.19     16.63

Sports Illustrated

     9.17     8.33     10.55

TV Guide

     6.37     4.10     3.67

People en Espanol

     2.94     1.92     1.78

Source: 2011 MRI Doublebase Study.

Read As: An insertion in Parade reaches 30.37% of Adults 18+. Reach percentage reported above is based on publisher’s estimates.

 

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14. Nationwide Publication Circulation

 

 

Total number of copies sold through all channels (subscription, newsstand)

The selected publications include some of the largest circulating publications in the country. Combined, they provide a total circulation of over 68 million.

 

Publication

   Total Circulation

Parade

   33,000,000

USA Weekend

   22,297,000

People

   3,450,000

National Geographic

   4,400,000

Sports Illustrated

   3,150,000

TV Guide

   2,000,000

People en Espanol

   540,000
  

 

TOTAL

   68,837,000
  

 

Source: ABC audit and publisher’s statements.

 

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15. Publication Secondary Reader Data

 

 

Secondary or ‘pass-along’ readers of a publication.

Based on MRI readership data, we know that more readers than just those who purchase or otherwise receive circulated issues actually open or read the publication. Many secondary readers see the Publication Notice away from home: for example, at a subscriber’s house; at a doctor’s office; in an airport; on an airplane; in the reception area of a company; passed around by co-workers at the place of employment; etc. Exposure in a different environment can increase attentiveness and response potential. It is also beneficial that readership tends to build over a period of time following the publication date. This is evidence that issues can be referred to at any time, thereby providing readers with a longer, sustained opportunity to be exposed to the Notice.

The following calculations set forth the average number of readers-per-copy of each of the selected publications:

 

Publication

   Readers Per Copy

Parade

   2.10

USA Weekend

   1.85

People

   13.14

National Geographic

   7.23

Sports Illustrated

   6.64

TV Guide

   6.5

People en Espanol

   12.42

Source: 2011 MRI Doublebase Study audience numbers and ABC statements.

 

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16. Nationwide Publication Audience Data

 

 

Total different persons opening or reading a publication.

The following outlines the total Adult audience (readership) for one insertion in each of the selected publications. The total audience is based on actual MRI in-depth interview data that tell us how many persons “Opened or Read” a publication.

 

Publication

   Total Adult Audience

Parade

   69,278,000

USA Weekend

   41,249,000

People

   45,318,000

National Geographic

   31,813,000

Sports Illustrated

   20,926,000

TV Guide

   13,000,000

People en Espanol

   6,708,000

Source: 2011 MRI Doublebase Study.

 

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17. Nationwide Publication Gross Impressions

 

 

Total number of times any person opens or reads publications containing notice placements.

Adults will be exposed to the Publication Notice through the publication effort alone more than 307 million times during the notice period. This includes the same reader more than once, because readers of one publication read other publications as well. This duplication is factored out by the net reach analysis explained earlier.

 

Publication

   Insertions    Adult Impressions

Parade

   1    69,278,000

USA Weekend

   1    41,249,000

People

   2    90,636,000

National Geographic

   1    31,813,000

Sports Illustrated

   2    41,852,000

TV Guide

   2    26,000,000

People en Espanol

   1    6,708,000
  

 

  

 

TOTAL

   10    307,536,000
  

 

  

 

Source: 2011 MRI Doublebase Study.

 

© 2012 Hilsoft Notifications

 

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18. National Business Publication Plan

 

 

The nationwide business publications in which the notice will appear.

The Notice Plan includes placements of the Publication Notice in leading national business publications targeting both business owners and business financial decision makers.

 

Publication

  

Issuance

  

Notice Content

   # of Insertions

Barron’s

   Daily    Full Page    1

Bloomberg BusinessWeek

   Weekly    Full Page    1

Financial Times

   Daily    4 col. x 10.87    1

Forbes

   Bi-weekly    Full Page    1

Fortune

   18x/year    Full Page    1

Investor’s Business Daily

   Daily    1/2 page    1

New York Times

   Daily    Junior Page    1

Wall Street Journal

   Daily    5 col x 10.5    1
        

 

TOTAL

         8
        

 

 

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19. National Business Publication Circulation

 

 

Total number of copies sold through all channels (subscription, newsstand)

The selected publications include some of the largest circulating publications in the country. Combined, they provide a total circulation of over seven million.

 

Publication

   Total Circulation

Barron’s

   304,000

Bloomberg BusinessWeek

   932,000

Financial Times

   337,000

Forbes

   930,000

Fortune

   844,000

Investor’s Business Daily

   184,000

New York Times

   1,376,000

Wall Street Journal

   2,118,000
  

 

TOTAL

   7,025,000
  

 

Source: ABC audit and publisher’s statements.

 

© 2012 Hilsoft Notifications

 

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20. National Business Publication

Secondary Reader Data

 

 

Secondary or ‘pass-along’ readers of a publication.

Based on MRI readership data, we know that more readers than just those who purchase or otherwise receive circulated issues actually open or read the publication. Many secondary readers will see the Publication Notice away from home: for example, at a subscriber’s house; at a doctor’s office; in an airport; on an airplane; in the reception area of a company; passed around by co-workers at the place of employment; etc. Exposure in a different environment can increase attentiveness and response potential. It is also beneficial that readership tends to build over a period of time following the publication date. This is evidence that issues can be referred to at any time, thereby providing readers with a longer, sustained opportunity to be exposed to the Notice.

The following calculations set forth the average number of readers-per-copy of each of the selected publications:

 

Publication

   Readers Per Copy

Barron’s

   1.3

Bloomberg BusinessWeek

   4.06

Financial Times

   3.0

Forbes

   4.6

Fortune

   4.03

Investor’s Business Daily

   2.0

New York Times

   1.86

Wall Street Journal

   2.3

 

   

Source: 2011 MRI Doublebase Study audience numbers and ABC statements.

 

© 2012 Hilsoft Notifications

 

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21. National Business Publication

Audience Data

 

 

Total different persons opening or reading a publication.

The following outlines the total Adult audience (readership) for one insertion in each of the selected publications. The total audience is based on actual MRI in-depth interview data that tell us how many persons “Opened or Read” a publication.

 

Publication

   Total Adult Audience

Barron’s

   395,200

Bloomberg BusinessWeek

   3,783,920

Financial Times

   1,011,000

Forbes

   4,278,000

Fortune

   3,401,320

Investor’s Business Daily

   368,000

New York Times

   2,559,360

Wall Street Journal

   4,871,400
  

 

TOTAL

   20,668,200
  

 

Source: 2011 MRI Doublebase Study.

 

© 2012 Hilsoft Notifications

 

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22. Trade, Business and Specialty Publications

 

 

The trade and business publications in which the notice will appear.

The Publication Notice will appear once or twice as appropriate in 72 publications targeted to business owners and business financial decision makers. The selected publications, which include all editions of Crain’s and national business journals, have a combined circulation of over one million. The following provides circulation data for the selected Trade, Business and Specialty publications:

 

Publication

  

Distribution

  

Language

  

# of
Insertions

  

Circulation

Crain’s New York    New York    English    2    49,583
Crain’s Chicago    Chicago    English    2    45,667
Crain’s Detroit    Detroit    English    2    25,342
Crain’s Cleveland    Cleveland    English    2    20,580
Convenience Store News    National    English    1    70,364
Supermarket News    National    English    2    25,850
Mass Market Retailers    National    English    2    20,500
Stores    National    English    1    45,540
Integrated Solutions for Retailers    National    English    1    22,500
Chain Store Age    National    English    1    26,980
The Business Review    Albany    English    2    7,060
New Mexico Business Weekly    Albuquerque    English    2    4,026
Alaska Journal of Commerce    Anchorage    English    2    6,349
Atlanta Business Chronicle    Atlanta    English    2    37,860
Austin Business Journal    Austin    English    2    9,267
Baltimore Business Journal    Baltimore    English    2    9,894
Birmingham Business Journal    Birmingham    English    2    6,911
Boston Business Journal    Boston    English    2    18,328
Buffalo Business First    Buffalo    English    2    7,795
Charlotte Business Journal    Charlotte    English    2    14,081
Business Courier    Cincinnati    English    2    12,877
Colorado Springs Business Journal    Colorado Springs    English    2    2,647
Columbus Business First    Columbus    English    2    11,462
Dallas Business Journal    Dallas    English    2    17,072
Dayton Business Journal    Dayton    English    2    3,996
Denver Business Journal    Denver    English    2    16,239
Des Moines Business Record    Des Moines    English    2    6,230

 

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El Paso, Inc    El Paso    English    2    8,000
Fairfield County Business Journal    Fairfield    English    2    9,283
The Business Journal    Fresno    English    2    5,050
The Business Journal (Triad)    Greensboro    English    2    6,349
Pacific Business Journal    Honolulu    English    2    14,729
Houston Business Journal    Houston    English    2    18,652
Mississippi Business Journal (Jackson)    Jackson    English    2    5,379
Jacksonville Business Journal    Jacksonville    English    2    9,806
Kansas City Business Journal    Kansas City    English    2    12,471
VEGAS, INC    Las Vegas    English    2    7,268
Long Island Business News    Long Island    English    2    8,867
Los Angeles Business Journal    Los Angeles    English    2    24,498
Business First (Louisville)    Louisville    English    2    10,937
Memphis Business Journal    Memphis    English    2    6,546
South Florida Business Journal    Miami    English    2    10,570
The Business Journal (Milwaukee)    Milwaukee    English    2    13,143
Minneapolis/St. Paul Business Journal    Minneapolis    English    2    13,882
Nashville Business Journal    Nashville    English    2    7,506
NJBIZ    New Jersey    English    2    16,133
New Orleans City Business    New Orleans    English    2    8,066
Sonoma Napa & Marin County Business Journal    North Bay    English    2    7,602
The Journal Record    Oklahoma City    English    2    3,018
Orlando Business Journal    Orlando    English    2    9,571
Philadelphia Business Journal    Philadelphia    English    2    13,144
Phoenix Business Journal    Phoenix    English    2    15,785
Pittsburgh Business Times    Pittsburgh    English    2    13,232
Business Journal (Portland)    Portland    English    2    10,616
Triangle Business Journal (Raleigh/Durham)    Raleigh/Durham    English    2    9,637
Rochester Business Journal    Rochester    English    2    8,831
Sacramento Business Journal    Sacramento    English    2    14,171
San Antonio Business Journal    San Antonio    English    2    9,987
San Diego Business Journal    San Diego    English    2    13,602
San Fernando Valley Business Journal    San Fernando Valley    English    2    6,026

 

© 2012 Hilsoft Notifications

 

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San Francisco Business Times    San Francisco    English    2    20,029
Silicon Valley/San Jose Business Journal    San Jose    English    2    9,891
Pacific Coast Business Times (Santa Barbara)    Santa Barbara    English    2    2,994
Puget Sound Business Journal (Seattle)    Seattle/Tacoma    English    2    19,765
St. Louis Business Journal    St. Louis    English    2    19,749
Central New York Business Journal    Syracuse    English    2    14,547
Tampa Bay Business Journal    Tampa Bay    English    2    9,590
Inside Tucson Business    Tucson    English    2    5,199
Washington Business Journal (D.C.)    Washington, DC    English    2    17,502
Washington State Regional Business Journal    Wenatchee    English    2    8,214
Westchester County Business Journal    Westchester County    English    2    9,574
Wichita Business Journal    Wichita    English    2    5,885
           

 

TOTAL

            1,040,296
           

 

 

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23. Language & Ethnic Targeted Publications

 

 

In order to target foreign language and ethnic business owners and business financial decision makers affected by the Settlement in mediums culturally appropriate to them, the Publication Notice will appear as a half-page or full-page ad unit two times in selected daily or weekly publications and one time in selected monthly publications. The Publication Notice will be translated into Spanish, Chinese, Japanese, Korean, Russian, Thai, and Vietnamese where appropriate. The 163 selected publications have a combined circulation of over 6.5 million. The following provides circulation data for language & ethnic targeted publications:

 

Publication

  

Distribution

  

Language

  

# of
Insertions

  

Circulation

US Asian Post (Chicago)    Chicago    English    2    15,000
Serey Pheap, Cambodian Weekly News    Los Angeles    Bilingual    2    20,000
Taiwan Daily    Los Angeles    Chinese    2    30,000
US Asian Post (Southern California)    Los Angeles    English    2    80,000
US Asian Post (New York/ New Jersey)    NY    English    2    30,000
Epoch Times — Chicago (Chinese Edition)    Chicago    Chinese    2    15,400
Sing Tao Daily — Chicago (Mon-Thu Ed.)    Chicago    Chinese    2    10,000
World Journal — Midwest Edition    Chicago    Chinese    2    30,000
Asian Gazette    Dallas/Ft. Worth    Chinese    2    8,000
Dallas Chinese News    Dallas/Ft. Worth    Chinese    2    15,000
Epoch Times — Dallas (Chinese Edition)    Dallas/Ft. Worth    Chinese    2    6,000
Chinese Daily News — Los Angeles (Th-Sa Edition)    Los Angeles    Chinese    2    100,000
Chinese L.A. Daily News    Los Angeles    Chinese    2    65,000
Sing Tao Daily — Southern California (Mon-Thu Ed.)    Los Angeles    Chinese    2    15,000
Epoch Times -New York (Chinese Edition)    NY    Chinese    2    15,000
Sing Tao Daily — New York (M-Th Edition)    NY    Chinese    2    55,000

 

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World Journal New York — Chinese Daily News (Su-Th Edition)    NY    Chinese    2    70,000
China Viet News (Broadsheet — Section A)    Philadelphia    Chinese    2    5,000
Epoch Times — Philadelphia (Chinese Edition)    Philadelphia    Chinese    2    6,500
Metro Chinese Weekly    Philadelphia    Chinese    2    10,000
Pinoy Monthly    Chicago    English    1    10,000
Via Times    Chicago    English    1    25,000
Asian Journal (Southern California)    Los Angeles    English    2    35,000
California Examiner (Los Angeles)    Los Angeles    English    2    50,000
Philippine News — Los Angeles Edition    Los Angeles    English    2    26,000
Filipino Reporter    NY    English    2    25,000
Chicago Shimpo    Chicago    Bilingual    2    5,000
Bridge USA    Los Angeles    Japanese    1    40,000
Japanese Daily Sun, The    Los Angeles    Japanese    2    120,000
Pacific Citizen    Los Angeles    English    2    30,000
Daily Sun New York    NY    Japanese    2    12,500
NY Japion    NY    Japanese    2    23,000
Seikatsu Press    NY    Japanese    2    20,000
Korea Daily — Chicago    Chicago    Korean    2    58,000
Korea Times — Chicago    Chicago    Korean    2    50,000
Korean Journal — North Texas Edition    Dallas/Ft. Worth    Korean    2    7,500
News Korea    Dallas/Ft. Worth    Korean    2    10,000
Korea Daily — Los Angeles    Los Angeles    Korean    2    80,000
Korea Times — Los Angeles    Los Angeles    Korean    2    75,000
Korean Sunday News — Los Angeles    Los Angeles    Korean    2    53,000
Korea Daily — New York    NY    Korean    2    58,750
Korea Times — New York Edition    NY    Korean    2    45,000
New York Ilbo, The    NY    Korean    2    55,000
Korean Community News & Sunday Topic    Philadelphia    Korean    2    10,000

 

© 2012 Hilsoft Notifications

 

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Korean Times Philadelphia (formerly known as Korea Daily News)    Philadelphia    Korean    2    23,000
Reklama Russian Weekly Newspapers    Chicago    Russian    2    22,000
Svet    Chicago    Russian    2    12,000
Friday Express    Los Angeles    Russian    2    17,000
Panorama (Formerly Almanac Panorama)    Los Angeles    Russian    2    9,000
Russkaya Reklama — California Edition    Los Angeles    Russian    2    15,000
Kurier-East Edition    NY    Russian    2    10,000
Russkaya Reklama — New York Edition    NY    Russian    2    30,000
Russian Market — Pennsylvania Edition    Philadelphia    Russian    2    8,000
Russkaya Reklama — Philadelphia Edition    Philadelphia    Russian    2    15,000
Vecher    Philadelphia    Russian    2    10,000
Asian Pacific News, The    Los Angeles    Bilingual    2    20,000
Sereechai Newspaper    Los Angeles    Thai    2    15,000
Siam Town US (formerly Thai Town USA News)    Los Angeles    Thai    2    10,000
A Chau Thoi Bao    Dallas/Ft. Worth    Vietnamese    2    30,000
But Viet    Dallas/Ft. Worth    Vietnamese    2    27,500
Vietnam Weekly News — Texas Edition    Dallas/Ft. Worth    Vietnamese    2    15,000
Nguoi Viet Daily News    Los Angeles    Vietnamese    2    17,700
Saigon Times    Los Angeles    Vietnamese    2    30,000
Viet Bao Daily News-LA Edition (Formerly Known as Viet Bao Kinh Te)    Los Angeles    Vietnamese    2    25,000
Lac Hong Magazine    NY    Vietnamese    1    5,000
Metro Viet    Philadelphia    Vietnamese    2    8,000
Philadelphia Asian News    Philadelphia    Vietnamese    2    10,000
Atlanta Inquirer    Atlanta    English    2    40,000
Sentinel Newspaper, The    Atlanta    English    2    35,000
Boston Banner (Baystate Banner)   

Boston/

Manchester

   English    2    32,351
Chicago Citizen Newspaper Group (5 Papers — Forced Combo)    Chicago    English    2    121,000

 

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Crusader Group (Chicago-Gary — Forced Combo)    Chicago    English    2    146,590
North Lawndale Community News, The    Chicago    English    2    15,000
African American News & Issues (Dallas — Ft. Worth Metroplex Region)    Dallas/Ft. Worth    English    2    150,000
Dallas Examiner    Dallas/Ft. Worth    English    2    9,449
La Vida News -The Black Voice — Ft. Worth Edition    Dallas/Ft. Worth    English    2    39,700
African American News & Issues (Greater Houston Gulf Coast, Southeast Texas)    Houston    English    2    250,000
Houston Defender    Houston    English    2    20,215
Houston Sun, The    Houston    English    2    10,000
L.A Bay/Bakersfield/San Fernando & Antelope Valley Observer Group    Los Angeles    English    2    102,892
Precinct Reporter/Tri-County Bulletin/Long Beach Leader    Los Angeles    English    2    55,000
Wave Community Newspapers (6 publications)    Los Angeles    English    2    140,000
Daily Challenge    NY    English    2    81,000
New York Amsterdam News    NY    English    2    30,000
New York Journal, The    NY    English    2    65,000
Philadelphia Observer    Philadelphia    English    2    22,840
Philadelphia Sunday Sun    Philadelphia    English    2    20,000
Philadelphia Tribune — Metro Edition    Philadelphia    English    2    63,210
Post News Group Newspaper Network (6 Paper Combo)   

San Francisco/

Oakland/

San Jose

   English    2    60,000
San Francisco Bay View Newspaper   

San Francisco/

Oakland/

San Jose

   English    1    20,000
Sun Reporter Publishing Company   

San Francisco/

Oakland/

San Jose

   English    2    160,621
Washington Afro-American /    Washington, DC    English    2    14,390

 

© 2012 Hilsoft Notifications

 

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