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Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 1 of 29 PageID #: 88961

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

In re PAYMENT CARD INTERCHANGE
FEE AND MERCHANT DISCOUNT
ANTITRUST LITIGATION

This Document Relates To:
ALL ACTIONS.

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MDL No. 1720(MKB)(JO)
Civil No. 05-5075(MKB)(JO)
JOINT STATUS CONFERENCE
STATEMENT
CONFERENCE DATE: August 11, 2016

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Pursuant to the Court’s June 30, 2016 Order, the parties submit this Joint Case Status Report
and Proposed Agenda for the Case Management Conference on August 11, 2016.
PROPOSED CONFERENCE AGENDA
The parties jointly and respectfully propose that the Court address the following issues at its
August 11, 2016 conference:
1.

Introduction of Parties and Counsel;

2.

Issues Raised by the Second Circuit’s Decision;

3.

Discovery;

4.

Pending Motions and Motions Subject to Reinstatement;

5.

Stipulation Regarding Definitive Class Settlement Agreement; and

6.

Third Party Claim Filers.

The parties’ positions with regard to next steps are detailed separately below.
I.

PARTIES
The parties made efforts to circulate drafts of this report to all interested parties for their

input. The parties submitting this report are:
1.

Class Plaintiffs;

2.

Defendants;1

1

Visa Inc.*; Visa International Service Association*; Visa U.S.A. Inc.*; MasterCard
Incorporated*; MasterCard International Incorporated*; Bank of America, N.A.*; BA Merchant
Services LLC (f/k/a National Processing, Inc.); Bank of America Corporation*; FIA Card Services,
N.A.*; MBNA America Bank, N.A.; Barclays Bank plc; Barclays Bank Delaware; Capital One
Bank(USA), N.A.; Capital One F.S.B.; Capital One Financial Corp.; JPMorgan Chase & Co.*;
JPMorgan Chase Bank, N.A.*; Chase Bank USA, N.A.*; Chase Manhattan Bank USA, N.A.; Chase
Paymentech Solutions, LLC*; Bank One Corporation; Bank One, Delaware, N.A.; Citibank N.A.*;
Citigroup Inc.*; Citicorp; Citicorp Payments Services, Inc.*; Fifth Third Bancorp; First National
Bank of Omaha; HSBC Finance Corporation; HSBC Bank USA, N.A.; HSBC North American
Holdings, Inc.; National City Corporation; National City Bank of Kentucky; SunTrust Banks, Inc.;
SunTrust Bank; Texas Independent Bancshares, Inc.; Wells Fargo & Company*; and Wells Fargo
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3.

Plaintiffs in 14-md-1720, the Individual Cases, which include several groups, each

with its own Complaint:
(a)

The 7-Eleven Plaintiffs;2

(b)

The Target Plaintiffs;3

(c)

The Tedeschi, Casey’s and Au Energy Plaintiffs;4

(d)

The Tavern Hospitality Plaintiffs;5

(e)

Hobby Lobby Plaintiffs;6

Bank, N.A.* Only those defendants identified with a “*” are named in one of the still-pending
individual actions.
2

This group consists of 7-Eleven, Academy Sports, Aldo, Alimentation Couche-Tard, Alon USA,
Amazon.com, AMC Theatres, Ashley Furniture, Barnes & Noble, Barnes & Noble College, Beall’s,
Boscov’s, Brookshire’s, The Buckle, Carter’s, Children’s Place, Coborn’s, Costco, Cracker Barrel,
Crate & Barrel, Cumberland Farms, D’Agostino’s, Dick’s Sporting Goods, Dillard’s, Drury Hotels,
Family Dollar, Family Express, Foot Locker, The Gap, Genesco, GNC, Gulf, HMSHost, IKEA,
Jetro, Lowe’s, Michaels Stores, Mills Companies, National Association of Convenience Stores,
National Community Pharmacists Association, National Grocers Association, New York &
Company, NIKE, P.C. Richard & Son, PacSun, Panda Restaurant Group, Panera, Ralph Lauren,
REI, Republic Services, Restoration Hardware, Sears, Starbucks, Stein Mart, Swarovski, Talbots,
Thermo Fisher Scientific, Thorntons, Whole Foods, and Yum! Brands.
3

This group consists of Target Corporation; Macy’s Inc.; The TJX Companies, Inc.; Kohl’s
Corporation; Staples, Inc.; J.C. Penney Company, Inc.; Office Depot Inc.; OfficeMax Incorporated
(now a subsidiary of Office Depot Inc.); L Brands, Inc.; Big Lots Stores, Inc.; Abercrombie & Fitch
Co.; Ascena Retail Group, Inc.; Saks Incorporated; Lord & Taylor LLC; The Bon-Ton Stores, Inc.;
Chico’s FAS, Inc.; Luxottica U.S. Holdings Corp.; American Signature, Inc., together with each of
their subsidiaries.

4

This group consists of all Plaintiffs in the following actions: Tedeschi Food Shops, Inc. v. Visa
Inc., et al., No. 16-cv-0659 (E.D.N.Y.) (MKB) (JO); Casey’s General Stores, Inc., et al. v. Visa Inc.,
et al., No. 16-cv-01604 (E.D.N.Y.) (MKB) (JO); and Au Energy, LLC, et al. v. Visa Inc., et al., No.
16-cv-3360 (E.D.N.Y.) (MKB) (JO).
5

The Tavern Hospitality Plaintiffs are Tavern Hospitality Group Holdings, LLC and Little Pub
Holdings, LLC.
6

Plaintiffs include Hobby Lobby Stores, Inc. and Mardel, Inc., which are pursuing their own
claims against Defendants Visa Inc., Visa U.S.A. Inc., Visa International Service Association,
MasterCard Incorporated and MasterCard International Incorporated. These plaintiffs’ case is on
-2-

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4.
II.

(f)

American Eagle Outfitters, Inc. (“American Eagle”);7

(g)

rue21, inc.; and

(h)

The Wal-Mart Plaintiffs.8

Objectors-Intervenors Retail & Merchants Objectors.

ISSUES RAISED BY THE SECOND CIRCUIT’S DECISION
On December 13, 2013, this Court filed a Memorandum and Order finally approving the

Definitive Class Settlement Agreement and certifying two settlement classes. Those two classes
consisted of:
Rule 23(b)(3) Settlement Class, from which exclusions shall be permitted,
consisting of all persons, businesses, and other entities that have accepted VisaBranded Cards and/or MasterCard-Branded Cards in the United States at any time
from January 1, 2004 to the Settlement Preliminary Approval Date [November 28,
2012], 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 [November 28, 2012], or the United States government.
and:
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 [November 28, 2012] or in the future accept any VisaBranded Cards and/or MasterCard-Branded Cards in the United States, except that
this Class shall not include the named Defendants, their directors, officers, or
hold due to a stipulation and order extending the time for the defendants to answer, and they
therefore take no position with respect to class issues or scheduling issues as covered in this Joint
Status Report.
7

American Eagle is the plaintiff in American Eagle Outfitters, Inc. v. Visa Inc., et al., No. 14-cv00321 (MKB) (JO) (E.D.N.Y.).
8

This group consists of Wal-Mart Stores, Inc., Wal-Mart Stores Texas, LLC, Wal-Mart Stores
East, LP, Wal-Mart Stores East, LLC, Wal-Mart Louisiana, LLC, Wal-Mart Stores Arkansas, LLC,
Sam’s West, Inc., Sam’s East, Inc., Wal-Mart.com USA, LLC, Vudu, Inc., Inkiru, Inc., Ozark
Spirits, LLC, Green River Spirits, LLC and Quality Licensing Corp. Wal-Mart’s action and Visa’s
declaratory judgment action against Wal-Mart have been stayed by stipulation.
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2016 Status Conference any parties seeking to represent a Fed. P.or MasterCard-Branded Card transactions at any time since January 1. On June 30. Responses to any such application(s) could be filed two weeks after any opening proposals. Civ. although class counsel respectfully disagree with the conclusions of both fact and law in the Second Circuit’s decision. 2004. As noted below. R. or the United States government. P. and thus it will not be the most efficient manner in which to present our positions for further potential review. it is prudent that the (b)(3)and (b)(2) classes each be represented by separate class counsel. and remand[ing] for further proceedings not inconsistent with this opinion. Class Plaintiffs’ Position Based on the Second Circuit’s opinion. 2016. 23(b)(2) class or classes may seek appointment by the Court.” A. revers[ing] approval of the settlement. -4- 1171972_1 . it was determined that an en banc petition would deprive this court of jurisdiction and further delay proceedings.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 5 of 29 PageID #: 88965 members of their families. the Second Circuit issued an opinion “vacat[ing] the district court’s certification of the class. R. Civ. Civ. It is Class Plaintiffs’ position that the current counsel remain co-lead counsel9 for the proposed Fed. 1. Second Circuit’s Opinion Class Plaintiffs disagree with the Second Circuit’s finding that class counsel were conflicted from representing both the Rule 23(b)(3) and (b)(2) classes for settlement purposes resulting in the 9 See attached Exhibit 1 (Pretrial Order No. R.or MasterCard-Branded Cards or acquired Visa. 5 dated February 24. 23(b)(3) class and that the Court set a time by which counsel seeking to represent a Fed. Class Plaintiffs suggest that this process commence immediately and that within 14 days of the August 11. P. or do so in the future. financial institutions that have issued Visa. 23(b)(2) class or classes submit an application to the Court. 2006 designating co-lead counsel for the Class Plaintiffs).

MasterCard. 215 (E. As Judge Gleeson noted.Y. initial public offerings (“IPOs”) converted each from a consortium of competitor banks into single-entity. based on future conduct that may never occur.N. Thus. since the case had been filed in 2005.” See In re Payment Card Interchange Fee & Merchant Discount Antitrust Litig. -5- 1171972_1 . 2d 207.D.” Id. the Durbin Amendment “removed the networks’ restrictions on discounting credit and debit cards at the network level.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 6 of 29 PageID #: 88966 reversal of the settlement.. in 2008 and 2006.10 While Class Plaintiffs acknowledge the risks of continued litigation and the benefits of the relief evaluated by Judge Gleeson in granting final approval of the settlement. and that those Due Process rights trump the Due Process rights of plaintiffs and defendants in complex cases that involve both damage claims and claims for injunctive relief to settle those cases in a manner which provides future certainty for both plaintiffs and defendants. American Express and Discover can no longer prohibit 10 The panel opinion effectively says that entities who do not now exist have Due Process rights in future causes of action that do not now exist. do not mention a number of critical aspects of these Orders many of which were given little or no attention by the Second Circuit in its decision vacating the settlement. some of which are attributable in whole or in part to the case itself. Supp. 2013). tremendous changes were occasioned by class counsel’s efforts – even apart from the settlement – that greatly benefited the proposed Class during the course of the litigation. Defendants’ description of the procedural history of the litigation. Also. 986 F. As a result of the extensive record and the risks this litigation imposed on the Networks and Banks. respectively. publicly traded companies with no bank governance. “The very structures of Visa and MasterCard themselves changed. and the District Court’s Orders granting final approval of the settlement. Class Plaintiffs disagree with Defendants to the extent that they are suggesting those findings show that plaintiffs cannot establish liability in this case as explained in detail in their opposition to Defendants’ motions for summary judgment. those evaluations were ignored by the Second Circuit panel in reaching its conclusions. there “have been significant developments in the industry. Visa.

those dominoes will have to fall in other forums.” Id. Judge Infante and Professor Green. of course.” Id. Supp. and determined. after an investigation assisted by the information developed by the plaintiffs here. see also In re Payment Card Interchange Fee & Merchant Discount Antitrust Litig. 441 (E. My own participation in the efforts to settle the case (along with Magistrate Judge Orenstein) 11 Id.”11 This. Those negotiations were assisted by two eminent mediators.Y. is in addition to the fact that the settlement was “the largest-ever cash settlement in an antitrust class action. 991 F.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 7 of 29 PageID #: 88967 merchants from discounting their cards. In consent decrees filed in 2011. who have informed the Court that the settlement negotiations were fair and conducted at arm’s length.N. MasterCard and American Express. Visa and MasterCard agreed to remove their rules prohibiting merchants from product-level discounting of credit and debit cards. That does not alter the significance of the relief provided by the proposed settlement. the government piggybacked on their efforts”). Judge Gleeson (with the assistance of Magistrate Judge Orenstein) presided over this litigation for over eight years. at 215 (emphasis added). Even if the objectors are right in contending that additional dominoes must fall before the alleged anticompetitive behavior of Visa and MasterCard is eradicated. telephonic and written negotiations. -61171972_1 . Additionally. at 220.D. contrary to the Second Circuit’s findings: “This proposed settlement adds another crucial reform – the lifting of restrictions on network. the Department of Justice (“DOJ”) filed lawsuits against Visa.and productlevel surcharging. at 229. The lawyers for the parties spent a great deal of time in face-to-face.” Id. The Rule 23(b)(3) class will benefit from continuing to be represented by class counsel.. “[i]n 2010. Class Counsel worked and contributed toward the passage of the Durbin Amendment. Judge Gleeson also found: “The proposed settlement is the product of arm’s-length negotiations between experienced and able counsel on all sides. 2d 437. 2014) (“the plaintiffs did not piggyback on previous government action – indeed.

things change. no matter how unrelated they may be to the claims and conduct at issue here. they are arguably irrational . at 223. and there is reason to believe that these state-law impediments to a full deployment of the proposed relief will eventually be among them. Other changes are not subject to the release. the relief was substantial. “The proposed elimination of the nosurcharge rules finally would allow merchants to make transparent and avoidable what has been opaque and inevitable. If the networks make non-substantive changes to the post-release rules and related conduct. Nosurcharge laws are not only anti-consumer. The Second Circuit explicitly noted it was not calling into question the actions of class counsel. . Judge Gleeson gave careful consideration to the objections even though “substantially less than one-tenth of one percent of the merchants have objected. but that is no reason to prohibit the networks from making any rules changes. Judge Gleeson also carefully considered the release finding: “That the release extends to future challenges to the reformulated rules or ‘substantially similar’ ones does not create the giant loophole multiple objectors fear. And Judge Gleeson noted that building on the reforms the case engendered.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 8 of 29 PageID #: 88968 confirmed those descriptions of the negotiations. there will be no reason for the release not to operate. Current Class Counsel Should Remain as Counsel to the (b)(3) Class The reasons that class counsel should remain as counsel to the (b)(3) class are many. at 232. . And as to those states that prohibit surcharging Judge Gleeson noted: “More importantly. at 221. at 231. Judge Gleeson also carefully analyzed the ability of merchants to surcharge and concluded. Is there room for litigation over whether future rules are ‘substantially similar?’ Of course.” Id.” Id. 2.” Id. and nothing in the record suggests otherwise. at 236. even though there are 10 states that prohibit surcharge.” Id. along with rule changes -71171972_1 . on pain of losing the protection of an otherwise lawful release.” Id.

In mid-2005. orderly. a host of merchants and trade associations filed putative class and individual actions in this Court and elsewhere. and efficient fashion. Defendants’ Position Defendants respectfully request that the Court set a deadline for submissions from all interested parties regarding the continued appointment or new appointment of lead interim class counsel for each of the putative classes. Class counsel has expended an enormous “amount of time and energy” and resources litigating the MDL 1720 class action on behalf of the proposed Rule 23(b)(3) merchant class. These factors endure today and militate against replacing class counsel as interim lead counsel for the Rule 23(b)(3) class. as would be expected to achieve such a result. Id. B. 991 F. 278. 2d at 442. in addition to competency and the ability to work cooperatively with opposing counsel and the Court. while freeing the Court to address issues of representation for the (b)(2) class interests raised by the Second Circuit opinion. party and non-party depositions and associated deadlines in the individual actions be held in abeyance so that the class and individual actions can proceed together in a coordinated. No. When the District Court appointed class counsel more than 10 years ago.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 9 of 29 PageID #: 88969 combined with the massive fund “plaintiffs’ counsel litigated the case with skill and tenacity. 1. each together with thousands of banks. Defendants also request that. Dkt. thus avoiding inefficient and duplicative efforts. Those actions alleged that Visa and MasterCard. and for 60 days following resolution. Magistrate Judge Orenstein recognized the important factors of efficiency and continuity. Supp.” Payment Card. pending resolution of those issues and any other issues relating to class representation. had conspired to violate the antitrust laws by adopting -81171972_1 . Procedural History The actions coordinated and consolidated in MDL 1720 have been ongoing for more than eleven years.

On February 23.” and other payment network rules that supposedly restrained trade. Miller & Ciresi LLP (now Robins Kaplan LLP). Co-lead plaintiffs’ counsel subsequently filed a consolidated complaint asserting claims on behalf of two classes—one class consisting of merchants that accepted Visa. the parties produced tens of millions of pages of documents. on July 17. Rudman. 2012. 2004 to the present. Geller. defendants reached settlement agreements with most of the putative class representatives and all of the individual merchants that were then pursuing actions. 2006. Kaplan. class certification.and MasterCardbranded payment cards from January 1.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 10 of 29 PageID #: 88970 “default interchange.and MasterCard-branded payment cards in the future—and coordinated discovery with other counsel pursuing separate claims by individual merchants.” On November 27. & Robbins LLP (now Robbins Geller Rudman & Dowd LLP).” “honor all cards. 2005. After the parties submitted a memorandum of understanding indicating that settlement was imminent.” “no surcharge. and summary judgment had been fully briefed and were pending before the Court. this Court preliminarily certified and approved two settlement classes. Stoia. motions for dismissal. 2012. as co-lead plaintiffs’ counsel. this Court appointed Robins. Coughlin. and one consisting of merchants that currently and will accept Visa. In 2012. The Court preliminarily certified under Rule 23(b)(3) a settlement class of merchants who -91171972_1 . PC. took hundreds of depositions. and Lerach. In the discovery period that followed. Berger & Montague. after years of negotiations overseen by two nationally recognized mediators as well as Judge John Gleeson and Magistrate Judge James Orenstein. As of November 2011. and completed expert discovery. Those actions were transferred by the Judicial Panel on Multidistrict Litigation (“JPML”) to this Court on October 19. the Court ordered that all pending motions for relief were “deemed withdrawn without prejudice to reinstatement if the settlement is not consummated.

the Court finally approved the settlement. 2013).D. The same order appointed co-lead plaintiffs’ counsel as Class Counsel for both the (b)(2) and (b)(3) settlement classes. The Court also preliminarily certified under Rule 23(b)(2) a settlement class of merchants and future merchants who currently accept and would accept Visa. 986 F. On December 13. Judge Gleeson specifically addressed the objectors’ challenges to the adequacy of the (b)(2) class representation and the viability of any equitable relief. the settlement for which provided billions of dollars to the class. the settlement for which awarded various forms of injunctive relief to that class. Judge Gleeson specifically noted that that the “lawsuit [was] an imperfect vehicle for addressing the wrongs the plaintiffs allege in their complaint” and that “there [were] forms of relief many objectors seek. 2d 207. that are beyond the reach of this case but will undermine (at least in the near term) the efficacy of the agreed upon relief. See In re Payment Card. such as the regulation of interchange fees. Supp. In approving the settlement. 2013.” as it could not “regulate interchange fees or enjoin nonparties or preempt state laws or reform network rules that do not violate the antitrust laws.10 1171972_1 .and MasterCard-branded payment cards from January 1. . 218-221 (E. and laws in some states that prohibit merchants from surcharging the use of credit cards. Judge Gleeson explained that “there are features of the industry landscape. such as other credit card issuers with whom defendants compete. a Court-appointed economics expert. at 218. at 219. that this Court could not order even if the plaintiffs obtained a complete victory on the merits.and MasterCard-branded payment cards in the future.Y. First. 2012.” Second.” Id. after additional briefing and objections by additional merchants. as well as considering the report submitted by Professor Sykes.N.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 11 of 29 PageID #: 88971 accepted Visa. 2004.” Id. With regard to this issue. the Court again pointed out that it was not in a position to “grant the sweeping relief the objectors seek. through November 27.

and in one case other defendants. 2016. certain of the 7-Eleven Plaintiffs have produced only a handful of documents.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 12 of 29 PageID #: 88972 Following the Court’s preliminary approval of the class settlement. four banks. Further. also filed declaratory judgment actions against certain merchants and trade associations. the parties are completing their privilege review and preparing for depositions. and produced millions of documents. 2016 and continue for a year. defendants have identified substantial deficiencies in the document productions of the 7-Eleven and Target Plaintiffs. there are numerous gaps in time for which these plaintiffs have not produced documents. both overall and on a custodian-bycustodian basis. conducted extensive negotiations over the scope and process of responding to those requests. 13 Pursuant to an agreement reported to the Court on June 2.12 Currently. with further negotiations scheduled in the future to determine limits for the remaining eight months. but many others have pushed forward with discovery. the parties have exchanged discovery requests. and have proceeded while the class settlement was on appeal. which are scheduled to start October 1.13 12 In preparing for depositions. 2016. These individual actions were included in MDL 1720 after being filed here or transferred here by the JPML. in one still-pending action. Indeed. for a number of their key custodians. 2014. 7-Eleven Plaintiffs have produced far fewer documents than their counterparts among the Target Plaintiffs.11 1171972_1 . the parties exchanged lists of deponents for the first two months of the deposition period on August 2. The parties have agreed to limits on the number of depositions for the first four months of the period only. and serious questions exist concerning the accuracy of the metadata for the documents they have produced. The Target Plaintiffs have failed to produce any documents for several of their custodians. Visa. The parties expect to take hundreds of depositions during the year-long deposition period. Defendants have raised these concerns with the 7-Eleven and Target Plaintiffs but have not yet received meaningful responses. . The Court approved a schedule for fact discovery in these actions on October 29. Defendants have reached settlements with a number of the Individual Plaintiffs. hundreds of merchants opted out of the (b)(3) settlement class and brought individual actions against Visa and MasterCard and. Pursuant to that schedule and subsequent modifications thereto.

2016. based on the evidence accumulated in discovery. [that those rules] cause anticompetitive harm that outweighs their pro-competitive benefits. at 227. a number of merchants filed notices appealing the Court’s decision. vacated the certification for settlement purposes of the (b)(2) settlement class. and remanded for further proceedings in this Court. The Second Circuit did not address certain findings by Judge Gleeson that bear upon the core issues here. 12-4671-cv(L). Supp.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 13 of 29 PageID #: 88973 In addition. Judge Gleeson. 986 F. . the panel held that reversal was necessary because co-lead plaintiffs’ counsel were conflicted from representing both the (b)(3) and (b)(2) classes for settlement purposes. as well as Professor Sykes. In re Payment Card Interchange Fee and Merchant Discount Antitrust Litig. reached that conclusion after finding.’” In re Payment Card. 2. 227 (quoting Sykes Report at 3). Despite Judge Gleeson’s findings. at 29-30 (2d Cir. see also Sykes Report at 30 (the merchants “face a substantial and perhaps rather large probability of eventual failure both as to liability and as to the prospects of significant monetary and injunctive relief”).. discussed above.” and that merchants “‘face considerable difficulty in establishing . slip op. that Visa’s and MasterCard’s respective “default interchange” and “honor all cards” rules “undeniably have significant procompetitive effects. following the Court’s approval of the settlement. Supp. 2d at 225.12 1171972_1 . . The Second Circuit’s Decision On June 30. 2d at 227 (quoting Sykes Report at 3). Judge Gleeson concluded that the merchants “‘face a substantial probability of securing little or no relief at the conclusion of trial.’” In re Payment Card. 2016). 986 F. “[n]o American court has ever held that Visa’s or MasterCard’s default interchange rules violate antitrust laws. As Judge Gleeson recognized.” Id. Among other things. June 30. Judge Gleeson further found that the Department of Justice’s “decision not to challenge the default interchange rules . the Second Circuit reversed this Court’s approval of the class settlement.

and. Depositions and Associated Deadlines in the Individual and Declaratory Judgment Actions Should be Held in Abeyance Until 60 Days after Issues Concerning Representation of the Putative Classes Are Resolved Defendants believe that the putative class and individual actions before this Court should be coordinated. . as they were before the class settlement agreement in 2012.13 1171972_1 .14 3. and as the JPML originally ordered. his findings on the potential merits of plaintiffs’ claims—all made on a substantial factual record—were not specifically addressed or criticized by the Second Circuit panel. among other things. Again. which the Court ordered on July 19. Defendants respectfully request that the Court set a date for submissions regarding any issues of interim representation of the putative merchant classes.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 14 of 29 PageID #: 88974 despite entreaties by [c]lass [c]ounsel that it do so further suggests that . make any appropriate determinations regarding continued or new interim class counsel appointments. to extend the time within which to determine whether to terminate the settlement agreement.” Id. Following issuance of the panel’s decision. He emphasized that “[a] number of courts and economists have found the Honor-All-Cards rule and similar rules to be procompetitive. the antitrust challenge to the rules could easily fail. 2016. “not fully affirmed on any appeal. counsel for defendants and the putative Class Plaintiffs entered into a stipulation. at a minimum. although Judge Gleeson’s decision approving the settlement was reversed. Accordingly. But any such coordination. along with other aspects of class representation. first requires certainty concerning class representation. (emphasis in original). . in defendants’ view Judge Gleeson’s findings serve as important guideposts for the ongoing conduct and any potential resolution of this litigation.” Id. 14 The Settlement Agreement provides that either side may terminate it “within twenty days” in the event that the Court’s Order approving the settlement is. after submissions are complete.” .

Moving forward with depositions in the individual actions now. Defendants and Individual Plaintiffs have spent years in discovery preparing for this deposition period. putative Class Plaintiffs would fall further behind the Individual Plaintiffs. and the benefits of coordination would be lost.14 1171972_1 . . it would needlessly compound Defendants’ burden and potentially prejudice the putative class. Defendants face the possibility that they will yet again be asked to redo discovery during certain time periods. the burden has been considerable. Defendants have already spent a considerable amount of time and effort working with Individual Plaintiffs to attempt to minimize the immense burden on defendants of redoing the collection and review of documents from the same time period over which the putative class sought discovery. this time by the putative Class Plaintiffs. Were depositions now to proceed in the individual actions. as well as the possibility of requests for additional discovery associated with expanded allegations in new and amended complaints. Finally. Deponents would face the likelihood of being deposed multiple times. and prejudice. and in fact Defendants have produced millions of additional documents in the pending individual actions.15 Now. while class representation remains uncertain and Individual Plaintiffs seek to expand their claims.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 15 of 29 PageID #: 88975 Defendants further request that the Court set deadlines for the filing of any new or amended complaints by both the putative class and Individual Plaintiffs and for Defendants’ responses to those new or amended complaints. Defendants request that the Court hold in abeyance the significant deposition program scheduled to begin in October and associated case management deadlines until 60 days after interim class counsel have been appointed and any new or amended pleadings have been filed. Despite those ongoing efforts. inefficiency. creates a meaningful risk of duplication. 15 The Individual Plaintiffs have also received the entirety of Defendants’ productions in the class case.

Further. We note. It is wrong that. Defendants’ notion that the Second Circuit did not dispute certain “findings” made by Judge Gleeson in the course of approving the settlement ignores the fact that the Second Circuit’s decision renders the settlement. as the Individual Plaintiffs claim. prioritizing discovery for the Individual Plaintiffs over that of the putative Class Plaintiffs turns the very purpose of an MDL like this one on its head. much as putative Class and Individual Plaintiffs proceeded previously before settlement was reached in 2012. for example. that the parties have already reached agreement on sharing the materials requested by putative Class Plaintiffs (see below). That sort of instruction has failed to alleviate the substantial document production burden Defendants have incurred in the individual actions.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 16 of 29 PageID #: 88976 By contrast. holding depositions and associated deposition deadlines in abeyance for a reasonable period of time so as to address class representation issues as may exist and any new allegations by the putative Class and Individual Plaintiffs avoids this risk. Individual Plaintiffs’ Position Individual Plaintiffs find it extraordinary that class plaintiffs and Defendants have decided to try to re-litigate their unsuccessful appeal in this status report. “instructing designated class counsel not to unduly duplicate the discovery undertaken by the 7-Eleven and Target Plaintiffs” would avoid the risks of duplication and inefficiency.15 1171972_1 . citing extensively from Judge Gleeson’s reversed decision and implying the Second Circuit’s stinging and lucid opinion somehow provides support for matters that the Circuit had absolutely no reason to reach or conclusively decided the other way. and all of the activities surrounding its negotiation and . and a limited postponement would also give the parties to the individual actions sufficient time to work through document production deficiencies and other issues. C. and would allow the parties to proceed in a coordinated and orderly fashion. and it is no answer to the threat of deponents sitting for multiple depositions on topics new and old.

Dkt. it is sufficient to note that the Second Circuit unanimously held that “class members of the (b)(2) class were inadequately represented in violation of both Rule 23(a)(4) and the Due Process Clause. as Judge Leval observed.. Dkt. denied motions to dismiss in the individual cases after the settlement decision. “nullities. of course. 7-Eleven Plaintiffs’ Additional Statement The 7-Eleven Plaintiffs’ include many of the objectors to the class settlement that concurrently opted-out of the settlement to assert claims for past damages against Visa. 12-4671-cv(L). 2016). 2016) (Leval. Dkt.” and that this inadequacy was in fact “confirmed by the substance of the deal that was struck.” In re Payment Card Interchange Fee & Merchant Discount Antitrust Litig.” In re Payment Card Interchange Fee & Merchant Discount Antitrust Litig. 30 (2d Cir. apparently the largest antitrust cash settlement in history...Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 17 of 29 PageID #: 88977 prior approval by Judge Gleeson. The Second Circuit’s decision also makes clear that the settlement negotiated by class counsel improperly compromised the Individual Plaintiffs’ fundamental right to litigate claims arising from the payment of billions of dollars in interchange fees. 1556 at 30. Simply put.16 1171972_1 . this is not the place to dispute the meaning of now-reversed opinions. Judge Gleeson. 1556 at 16. D. Defendants’ attempt to recast that decision as an implicit critique of the claims against them is at odds with any fair reading of the decision. “the fact that the Defendants were willing to pay $7. suggests that the claims were not entirely devoid of merit.25 billion. 12-4671-cv(L).” In re Payment Card Interchange Fee & Merchant Discount Antitrust Litig. Indeed. We think they should continue to do so. concurring). June 30. 12-4671-cv(L). June 30. For present purposes. and those cases are proceeding apace. the 7-Eleven plaintiffs would have asserted ongoing damages and injunctive claims had the settlement permitted . As their complaint makes clear. MasterCard and the four largest Visa/MasterCard member banks. 1557 at 2 (2d Cir.. J.

.e.17 - 1171972_1 . the now-vacated settlement explicitly released all damage claims concerning the FANF. . Honor All Issuer. and anti-steering rules violate Section 1 of the Sherman Act. and that defendants’ Honor All Issuer rules constitute anticompetitive agreements (1) among Visa member banks and (2) among MasterCard member banks not to compete for merchant acceptance or preference for form of payment at the point-of-sale. To briefly summarize. regulating certain aspects of the market to restrain Visa’s monopoly power. 16 Despite the fact that this fee was not introduced until April 2012. Visa agreed to permit Chase to enter into bilateral agreements with merchants and differentiate Chase from other Visa-issuing banks through such deals. shortly after the now vacated settlement was preliminarily approved in November 2012.16 The FANF was the linchpin of Visa’s strategy to maintain its monopoly power in the general-purpose debit-card market after Congress passed the Durbin Amendment as part of the Wall Street Reform Act. and with the settlement nullified the 7-Eleven Plaintiffs intend to seek consent to do so now. interchange rates. it was not presented in that case. It also includes allegations as to how.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 18 of 29 PageID #: 88978 them to do so. the 7-Eleven complaint asserts that Visa’s and MasterCard’s respective default interchange. As this claim concerns conduct that post-dated the discovery period and summary-judgment briefing in the class case. The 7-Eleven Plaintiffs’ complaint differs materially from the case developed by class counsel in that it deals with how the Honor All Issuers rules restrain competition among the banks for merchant acceptance and preference. i. The 7-Eleven complaint also includes monopolization claims against Visa concerning its imposition in 2012 of a new fee on merchants – the Fixed Acquirer Network Fee (“FANF”). These agreements not to compete are inextricably intertwined with Defendants’ unlawful agreements to collectively fix the prices for merchants’ acceptance of defendants’ payment cards.

and they would obviously be harmed if discovery were indefinitely stayed while preliminary issues that relate to the class action are addressed. The Target and 7-Eleven Plaintiffs have been actively litigating their individual cases against defendants for more than three years. and preparing for depositions.18 1171972_1 . The existing case schedule and its deadlines were established with the full understanding that the Second Circuit decision on the class settlement would be forthcoming. indefinite delay while the Court . reviewing documents. The now-vacated settlement has hindered and delayed the Individual Plaintiffs’ prosecution of their claims long enough. agreed deposition protocol and case schedule that calls for the identification of party deponents on August 2 and the commencement of party depositions in October. agreed-upon case schedule. The individual cases included in 14-md-1720 can and should proceed pursuant to the existing. Impact of the Second Circuit’s Decision on the Case Schedule in 14-md-1720 The Second Circuit’s opinion speaks for itself. and are about to begin party and third-party depositions pursuant to a court-ordered. As the Second Circuit decision acknowledges. The 7-Eleven and Target Plaintiffs have invested considerable resources in negotiating document requests. Requiring the 7-Eleven and Target Plaintiffs to endure further. Permitting further delay of discovery concerning the Individual Plaintiffs’ claims based upon the uncertainty as to the leadership of the class case would compound the prejudice that the Individual Plaintiffs have already suffered. who ignored clear conflicts of interest and negotiated a settlement that improperly limited the 7-Eleven and Target Plaintiffs’ ability to pursue their claims without providing a full right to opt out. the 7Eleven and Target Plaintiffs were prejudiced by the inadequate representation provided by class counsel.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 19 of 29 PageID #: 88979 1.

Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 20 of 29 PageID #: 88980 addresses class issues would only exacerbate the prejudice the 7-Eleven and Target Plaintiffs have already suffered. The Target and 7-Eleven Plaintiffs are confident that Visa’s and MasterCard’s concerns about duplicative discovery can be resolved by instructing designated class counsel not to unduly duplicate the discovery undertaken by the 7-Eleven and Target Plaintiffs.”).L. e. 2d 1352. may establish separate tracks for discovery and motion practice in any constituent MDL-1749 action or actions. 429 F.. 1370 (J. See. The Court has already granted Defendants one extension to address such purported deficiencies. 226 F. 2006) (“The transferee judge. & Derivative Litig. as the recent documents produced to Individual Plaintiffs date from after August 2006 and were never produced to the Class Plaintiffs. Such unfounded claims have become Defendants’ modus operandi for delay in this case.18 Such instructions are well within the discretion afforded to the Court in administering this multi-district proceeding.P. In re Worldcom.P.. & ERISA Litig. coordination of ongoing 14md-1720 discovery with any additional discovery that may be pursued in the class case can be addressed. . Supp. much as the Target and 7Eleven Plaintiffs have been cautioned not to unduly duplicate the discovery taken years ago in the class action.M. 2d 1368. Instead.. 1354-55 (J. 2002) (“Any concerns of the objecting ERISA plaintiffs that Section 1407 17 The Individual Plaintiffs will not respond in this report to the claim that there are defects in the document productions they made more than four months ago.M. on whatever timetable it deems appropriate. whenever he determines that such an approach is appropriate.19 - 1171972_1 .L.g..17 For these reasons. After the Court resolves preliminary issues with respect to the class action. 18 Defendants’ claim that they are being forced to “redo” existing discovery is unfounded. the most efficient course for all parties to 14-md-1720 is to proceed with discovery without further delay. of course. In re GMC Secs. Supp. Inc. Sec. much like their attempt to turn the Second Circuit’s rejection of the settlement into a lengthy delay of the Individual Plaintiffs’ right to pursue their multi-billion dollar claims. the Second Circuit decision should not affect the existing schedule in the 7-Eleven and Target cases.

2. 7-Eleven Plaintiffs’ Position In light of the Second Circuit’s decision concerning the adequacy of representation merchants received in the now-defunct settlement. For now. The 7-Eleven Plaintiffs also agree with class plaintiffs that this process commence promptly with an expedited briefing schedule. the (b)(2)/(b)(3) construct created by the now-rejected settlement should be modified in some respects.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 21 of 29 PageID #: 88981 centralization will somehow retard the pace at which their claims are prosecuted should be addressed to the transferee judge. b. should be heard on the issue. including the Individual Plaintiffs.20 1171972_1 . and should do so in a comprehensive fashion addressing both the b(3) and b(2) classes. the 7-Eleven Plaintiffs agree with Defendants that the Court should revisit the issue of the appointment of lead class counsel. Impact of the Second Circuit Decision on Class Representation a. Target Plaintiffs’ Position The Target Plaintiffs are pursuing their own claims in a separate case and therefore take no position on class issues. for obvious reasons. including (a) whether some or all of interim class counsel should be changed. the 7-Eleven Plaintiffs believe that an examination of the reasons why class counsel (and class plaintiffs) failed to adequately represent the class should await briefing and a hearing dedicated to that question. As for the class plaintiffs’ recitation in this status report of the merits of the settlement and their efforts in negotiating it. and (b) whether.”). and reiterate only that the process of resolving these and any other . who remains free to establish separate tracks for discovery and motion practice in any constituent MDL-1487 action or actions. whenever she concludes that such an approach is appropriate. All interested parties. the core holdings of the Second Circuit’s recent decision alone refute class counsel’s claims.

1. rue21 and the Tavern Hospitality Plaintiffs are pursuing their own claims in separate cases and therefore take no position on class issues. Inc. They operate more than 150 retail outlets across 13 states.) (namely. LLC and Susser Holdings Corporation (n/k/a Sunoco.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 22 of 29 PageID #: 88982 preliminary issues related to the class case should not delay the discovery schedule that applies to the Target Plaintiffs’ case or delay the ultimate resolution of their case. back-bench observers to the attempted settlement of their rights or these proceedings. Jacksons Food Stores. et al. June 30. *4 (2d Cir. E-Z Mart Stores. R&M Objectors consistently maintained that there had been a fundamental denial of due process reflected in a proposed settlement that trapped them into an agreement which had no real value to them.. No. Each member of this group pays interchange or “swipe” fees when they accept payment by credit card for goods sold to consumers. 13-cv-05352 (E. the remaining plaintiffs in E-Z Mart Stores./PacWest Energy. American Eagle. but they filed individual briefs before the Second Circuit securing the decertification of the class and reversal of approval of the attempted settlement. That position has been vindicated in the Second Circuit’s opinion in In re Interchange Fee and Merchant Discount Litigation. v. . 2016). LP)) join the 7-Eleven Plaintiffs.N. Caseys. 2016 WL 3563719. Others The Tedeschi. Inc. Inc. where they gave up valuable rights and received little else in return. Not only did they take an active role before the district court in opposing the certification of the class and the attempted settlement of the action.Y.D.21 1171972_1 . 19 As to this section only.. Visa.3d __. Inc. et al. R&M Objectors have not been casual. __ F.19 E. Position of Objectors-Intervenors The Retailers and Merchants Objectors (“R&M Objectors”) are a broad-based and diverse group of 64 separate business entities. Au Energy.

Tens of millions of pages of documents have been produced. document discovery in the individual cases has continued. depositions are set to begin in October. as there is currently no certified class or class counsel. associated case management deadlines. and all non-party depositions until 60 days after issues are resolved concerning representation of the putative classes and any new . Defendants are willing to make these materials available to putative Class Plaintiffs. B. Class Plaintiffs have an interest in not delaying ongoing discovery efforts. R&M Objectors suggest that the Court set a separate proceeding to address the question of the appointment of interim lead class counsel. DISCOVERY Since the class settlement.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 23 of 29 PageID #: 88983 In light of the concerns expressed by the Second Circuit regarding representation by present class counsel (Id. A. Class Plaintiffs’ Position Class Plaintiffs have requested that Defendants provide to them the same materials produced in the opt-out cases and that they be included in the upcoming depositions. Defendants’ Position Putative Class Plaintiffs have requested all materials produced by Defendants in the individual actions. On the understanding that Individual Plaintiffs do not object. With regard to the current discovery schedule in the individual actions.22 1171972_1 . Defendants request that the Court hold in abeyance the significant deposition program scheduled to begin in October. *4 and *6). III. for the reasons stated above. and without taking any position concerning who the Court should appoint as interim class counsel or whether additional discovery is appropriate in the putative class or individual actions. at 2016 WL 356719. Additionally.

However. Individual Plaintiffs do not object to Defendants’ providing copies of materials produced by Defendants in 14-md-1720 to interim class counsel.23 1171972_1 . The 7-Eleven and Target Plaintiffs acknowledge the need to coordinate discovery and have been working collaboratively with all parties to 14-md-1720 to do so. (3) the filing of any new or amended pleadings by the putative class. Individual Plaintiffs. As indicated above. and are ready to begin depositions pursuant to a court-ordered. Party depositions were to have begun already. C.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 24 of 29 PageID #: 88984 or amended pleadings have been filed. and Defendants. Defendants would have this Court delay any depositions until after (1) submissions from any interested parties regarding any issues of interim representation of the putative merchant classes. and prejudice to the parties. inefficiency. and (4) the passage of another 60 day period. agreed deposition protocol and case schedule that calls for the identification of party deponents on August 2 and the commencement of party depositions in October. (2) determinations regarding continued or new interim class counsel appointments. but were delayed at the request of Defendants. the Target and 7-Eleven Plaintiffs have been actively litigating their individual cases against defendants for more than three years. and are amenable to working with all parties to coordinate efforts going forward. The Court has already twice granted Defendants’ requests for extensions of the discovery schedule. Doing so will avoid duplication. on August 1. Individual Plaintiffs’ Position The Individual Plaintiffs’ cases included in 14-md-1720 can and should proceed pursuant to the existing case schedule. The 7-Eleven and Target Plaintiffs do not believe that the 14-md-1720 schedule should again be delayed – for an indefinite period – while the Court addresses issues concerning the class case that have been raised . the protracted and indefinite delay requested by Defendants would be unduly prejudicial to the Individual Plaintiffs.

Others The Tedeschi.24 1171972_1 . PENDING MOTIONS AND MOTIONS SUBJECT TO REINSTATEMENT Attached as Exhibit 2 is a list of the motions that were deemed withdrawn without prejudice to reinstatement at the time the parties announced the settlement of the class action in July 2012. D. The 7-Eleven and Target Plaintiffs also note that they intend to amend their complaints to include damages up through the date of judgment.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 25 of 29 PageID #: 88985 by the Second Circuit decision and awaits amended and new pleadings. These motions have been fully briefed and argued. R. The Individual Plaintiffs are confident that coordination of the ongoing 14-md-1720 discovery with any additional discovery that may be pursued in the class case can be addressed once class representation issues are resolved . now that the mandate has been returned to this Court and the injunction contained in the class settlement approval orders is no longer in effect. These motions have been fully briefed. Au Energy. 60 on July 28. as well as requests for injunctive relief. American Eagle takes no position regarding the timing of discovery related to the 7-Eleven and Target Plaintiffs. 2015. Caseys and the Tavern Hospitality Plaintiffs have not commenced discovery and take no position on the timing of discovery related to the 7-Eleven and Target Plaintiffs. . Civ. Additionally certain parties filed motions under Fed. P. IV. The 7-Eleven Plaintiffs are also considering amending their complaint to include new allegations based on the new documents defendants have produced to the Individual Plaintiffs.

The Second Circuit has ordered that the parties submit supplemental letters in light of the decision on the main appeal.20 A. The Individual Plaintiffs agree that the Rule 60(b) motions are moot now that the mandate has issued. Defendants agree with Class Plaintiffs and Individual Plaintiffs that the pending Rule 60 motions are now moot. Class Plaintiffs’ Position It is Class Plaintiffs’ position that the Court should continue to reserve judgment on the motions which were pending at preliminary approval while the parties address with the Court matters resulting from the Second Circuit’s June 30. the Individual Plaintiffs believe that the Court should consider the facts and circumstances addressed in the Rule 60(b) motions in assessing the adequacy of class counsel and their fitness to continue to serve as counsel for any merchant class. If the parties seek to reinstate any of the motions that were pending before the Court’s preliminary approval of the settlement. 2016 decision. 2016. Defendants’ Position Defendants believe that no action is required by the Court at this time with respect to motions previously filed in the class litigation. still pending at the Second Circuit is the service award. It is Class Plaintiffs’ position that the Second Circuit’s decision renders the Rule 60 motions moot. the Court can consider those requests in due course. B. service awards and expenses is mooted by the Second Circuit’s Order. fee and expense appeal.25 1171972_1 . . as the relief sought is unnecessary in light of the Second Circuit’s decision to vacate the class settlement.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 26 of 29 PageID #: 88986 Finally. This argument was deferred pending decision in 12-4671(L) (the main appeal). 20 Argument in 15-217(L) had been scheduled for May 16. C. However. Individual Plaintiffs’ Position The Individual Plaintiffs agree that no action should be taken at this time with respect to the motions deemed withdrawn at the time of the settlement. Plaintiffs also believe the appeal regarding fees.

maintain.520. and invest the Class Settlement Cash Escrow Account(s) as provided in the Class Settlement Cash Escrow Agreement (Appendix B to the Definitive Class Settlement Agreement).” the Stipulation without prejudice to the right of any party to lodge an objection to the stipulated relief at the conference scheduled for August 11.960. See attached Exhibit 3 (Definitive Settlement Agreement). 2016 the Court “so ordered. American Eagle and the Tavern Hospitality Plaintiffs agree with the Individual Plaintiffs’ position set forth above. 6636) regarding the time period during which the Definitive Class Settlement may be terminated. The Class Settlement Cash Escrow Account fund consists of $4.459. 2016.573. 2016 counsel for Class Plaintiffs and Counsel for Defendants submitted a Stipulation and Proposed Order (Dkt. 2016. has funds of $772. as of July 31.42 as of July 31. 2016.26 1171972_1 . .Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 27 of 29 PageID #: 88987 D. To date. 2016.01.181. and the Escrow Agent should continue to administer. and invest the Class Settlement Interchange Escrow Account(s) as provided in the Class Settlement Interchange Escrow Agreement. maintain. There are two Class Settlement Interchange Escrow Account(s). No. That account. Caseys and Au Energy Plaintiffs. Others The Tedeschi. The other Class Settlement Interchange Escrow Account consists of the Default Interchange Payments made pursuant to the Definitive Settlement Agreement. On July 19. V. Pursuant to that Stipulation the parties agreed that pending any termination of the Definitive Class Settlement Agreement. Under the Stipulation and Proposed Order the parties agreed the time period under which the Agreement may be terminated should be modified to extend to and include September 30. STIPULATION REGARDING DEFINITIVE CLASS SETTLEMENT AGREEMENT On July 18. no party has lodged an objection to the stipulated relief. the Escrow Agent should continue to administer. ¶¶11-13.

2014 Order. a number of third party claims filing companies sought to offer various settlement-related services to class members. 2014 detailing the history of required disclaimers and enjoining a claims filing entity. When claim forms do become available. No.21 The Court also issued an Order on October 3. A. 2013 Order). class members are not required to sign up with any thirdparty service in order to participate in the monetary relief. including several evidentiary hearings. .Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 28 of 29 PageID #: 88988 Class Plaintiffs provide the above to the Court for informational purposes. Class Counsel proposes the required disclaimers be altered as follows: Prior language: Claim forms are not yet available from the Class Administrator. A significant amount of satellite litigation occurred regarding these third parties. To protect class members from being misled by certain companies. See Dkt. 6193 at 1-2. Class Plaintiffs’ Position Because of the Second Circuit’s decision. 6141 (December 30. The claim form will inform most class members of their actual or estimated interchange fees on which it is proposed their claims will be paid.27 1171972_1 . No. Class Counsel has worked with the more than 50 companies it is aware of that offer such services and has submitted reports to the Court regarding these entities every six months. with the last report being submitted in April. No-cost assistance will be available from the Class 21 The steps required by the Court were memorialized in the Court’s January 13. see also Dkt. You may accept or dispute this estimate with the opportunity to submit additional information. See Dkt. 6349 at 27-34 (detailing the steps the Court has taken to protect class members). the Court ordered on December 20. VI. 2013 that certain language accompany solicitations for settlement-related services being offered by third parties. 6137. No. Class Counsel proposes that the required language be altered and that the entities offering services be contacted and told to update their required disclosures. but may instead file their claim directly with the Class Administrator. No. Dkt. THIRD-PARTY CLAIMS FILERS Following preliminary approval of the settlement in 2012.

Class members are not required to sign up with any third-party service in order to participate any settlement. the Courtapproved website for this case. Defendants’ Position Defendants agree that Court-ordered disclosures by claims-filing companies should be updated to accurately reflect the status of the settlement. the Court-approved website for this case.paymentcardsettlement.Case 1:05-md-01720-MKB-JO Document 6638 Filed 08/02/16 Page 29 of 29 PageID #: 88989 Administrator and Class Counsel during the claims-filing period. and no claim-filing deadline has been set. For additional information. Class Plaintiffs suggest that it contact known third parties to ensure those businesses alert their clients who have previously signed up for claims-filing about the Second Circuit’s decision. class members may visit www. Class Plaintiffs suggest it develop a notice with the input from third parties and present the notice to the Court for approval. 2016 Submitted on behalf of all Parties .com. no-cost assistance will be available from the Class Administrator and Class Counsel during the claims-filing period. B. class members may visit www. Therefore. 2016.paymentcardsettlement. no claim forms are available at this time. Additionally.com. For additional information. If another settlement is reached. New language: The Second Circuit Court of Appeals reversed approval of the settlement and returned the case to the District Court on June 30.28 1171972_1 . DATED: August 2.

Case 1:05-md-01720-MKB-JO Document 6638-1 Filed 08/02/16 Page 1 of 12 PageID #: 88990 EXHIBIT 1 .

oral argument. 2006. Conduct settlement negotiations on behalf of class plaintiffs. or such other fashion as may be appropriate) and present (in briefs. Civ. Co-lead counsel shall generally be responsible for coordinating the activities of class plaintiffs during pretrial proceedings and shall: Determine (after consultation with co-plaintiffs' counsel) and present (in briefs. P. Miller & Ciresi L. personally or by a designee) to the court and opposing parties the position of the class plaintiffs on all matters arising during pretrial proceedings..L. Coughlin. and Lerach. Coordinate the initiation and conduct of discovery on behalf of class plaintiffs' consistent with the requirements of Fed. Kaplan. Geller. but not enter into binding agreements except to the extent expressly authorized. 26(2). I appoint the following three law firms as co-lead counsel for the class plaintiffs: Robins. P. Designation of Counsel A. 26(b)(1). Rudman & Robbins. Co-Lead Plaintiffs' Counsel For the reasons set forth in a Memorandum and Order dated February 24. and 26(g).L. docket entry 278.P.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document 6638-1 279 Filed Filed 08/02/16 02/24/2006 Page 2Page of 121PageID of 3 #: 88991 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK ----------------------------------------------------------X IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT DISCOUNT ANTITRUST LITIGATION ORDER MDL 05-1720 (JG) (JO) This document refers to: ALL ACTIONS ----------------------------------------------------------X PRETRIAL ORDER 5 I. L. Berger & Montague. . or such other fashion as may be appropriate.. oral argument. including the preparation of joint interrogatories and requests for production of documents and the examination of witnesses in depositions. R.C.P. Stoia.

Block. as liaison counsel for the class plaintiffs.P. Haudek. Liaison counsel for the non-class plaintiffs shall generally be 2 . or when genuine and substantial divergence of opinion exists among counsel.L. Non-Class Plaintiffs I appoint the law firm Kenny Nachwalter. Prepare and distribute periodic status reports to the parties. Grossman & Gross L. Enter into stipulations with opposing counsel as necessary for the conduct of the litigation. Liaison Counsel 1. or submissions that differ from those of co-lead counsel in only minor ways. Maintain adequate time and disbursement records covering services as lead counsel. B. Class Plaintiffs I appoint the law firm Pomerantz. Monitor the activities of co-counsel to ensure that schedules are met and unnecessary expenditures of time and funds are avoided. P. However. 2. the parties and their counsel are encouraged to avoid presentations of cumulative views. as liaison counsel for the non-class plaintiffs in MDL 1720.A.. The class plaintiffs' liaison counsel shall be responsible for facilitating and expediting communications with and among co-lead plaintiffs' counsel. and Perform such other duties as may be incidental to proper coordination of class plaintiffs' pretrial activities or authorized by further order of the court. This order does not limit the right of other counsel for class plaintiffs to be heard on matters not susceptible to joint or common action.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document 6638-1 279 Filed Filed 08/02/16 02/24/2006 Page 3Page of 122PageID of 3 #: 88992 Delegate specific tasks to other counsel or committees of counsel in a manner to ensure that pretrial preparation for the class plaintiffs is conducted efficiently and effectively.

S. in a manner set forth by co-lead counsel. at 9:30 a. Absent a court order or agreement among plaintiffs' counsel to the contrary. New York February 24.m.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document 6638-1 279 Filed Filed 08/02/16 02/24/2006 Page 4Page of 123PageID of 3 #: 88993 responsible for coordinating and organizing the non-class plaintiffs in the conduct of the litigation. and other issues to be discussed at the conference. Prior to each scheduled status conference. The first status conference will occur on March 8. This conference will take place in the Brooklyn courthouse in courtroom 5. 2006. Dated: Central Islip. Submission Of Time Records All class plaintiffs' counsel in the class action cases shall submit on a periodic basis a record of the time expended on these matters. the parties's counsel are directed to meet and confer and file a joint report on the progress of the case. I will conduct bi-monthly status conferences with representatives of parties to this action. If warranted. 2006. SO ORDERED. 2006 /s/ James Orenstein JAMES ORENSTEIN U. The status report shall be submitted at least one week prior to the scheduled conference. any disputes requiring court intervention. III. Status Conferences And Status Reports As discussed at the initial conference on January 12. Magistrate Judge 3 . all co-lead and liaison counsel for the plaintiffs shall participate in these status conferences. I will entertain a timely application to cancel or adjourn any such conference. II.

Case 1:05-md-01720-MKB-JO Document 6638-1 Filed 08/02/16 Page 5 of 12 PageID #: 88994 EXHIBIT 2 .

5. 16. And Fraudulent Conveyance Claims. And Individual Plaintiffs’ Post-IPO Conspiracy Claims Defendants’ Memorandum of Law in Support Of The Motion For Summary Judgment As To The Claims In The Second Consolidated Amended Class Action Complaint Defendants’ Memorandum of Law in Support of the Motion to Exclude Certain Opinions of Class Plaintiffs’ Economic Expert Dr. Alan S. 3. 8. Post-IPO Conspiracy. 2. 14. 12. PLEADING Memorandum of Law in Support of Class Plaintiffs’ Motion for Class Certification Memorandum of Law in Support of Motion to Dismiss the First Amended Supplemental Class Action Complaint Memorandum of Law is Support of Motion to Dismiss Second Consolidated Amended Class Action Complaint Memorandum of Law in Support of Motion to Dismiss the Second Supplemental Class Action Complaint Memorandum of Law in Support of Chase Paymentech Solutions. Henry Memorandum of Law in Support of the Network Defendants’ Motion to Exclude the Opinions of Individual Plaintiffs’ Expert Professor Dan Ariely Memorandum of Law in Support of the Visa and MasterCard Defendants’ Motion to Exclude the Opinion of Dr. 7.Case 1:05-md-01720-MKB-JO Document 6638-1 Filed 08/02/16 Page 6 of 12 PageID #: 88995 In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation. 4. Gustavo Bamberger Letter Motion to Compel the Production of Evidence that has been Withheld Under a Claim of Privilege Letter Motion to seek entry of a scheduling order to govern the timing of disclosures and expert discovery regarding equitable relief sought by plaintiffs in MDL 1720 Class Plaintiffs’ Memorandum of Law In Support of Their Motion for Summary Judgment Memorandum Of Law In Support Of Defendants’ Motion For Summary Judgment On Class Plaintiffs’ IPO. Joseph Stiglitz Memorandum of Law in Support of Defendants’ Motion to Exclude the OPENING 2008/05/08 OPP 2008/10/06 REPLY 2009/01/29 SUR-REPLY 2009/06/25 2009/03/31 2009/06/02 2009/07/02 n/a 2009/03/31 2009/06/02 2009/07/02 n/a 2009/03/31 2009/06/02 2009/07/02 n/a 2009/03/31 2009/06/02 2009/07/02 n/a 2009/06/05 2009/07/10 2009/08/03 n/a 2009/07/28 2009/07/31 n/a n/a 2011/05/12 2011/05/17 n/a n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/13 2011/06/30 n/a 2011/02/11 2011/05/13 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 1 . 11. 13. 1. 9. LLC’s Motion to Strike Memorandum of Law in Support of Defendants’ Motion to Exclude Opinions of Dr. 15. 10. Frankel Memorandum of Law in Support of the MasterCard and Bank Defendants’ Motion to Exclude Testimony of Kevin F. 6. 1:05-MD-01720(MKB)(JO) Motions Pending as of Preliminary Approval No. Case No.

Vellturo 18. PLEADING Opinions of Victor Fleischer 17.T. Class Plaintiffs’ Motion to Exclude the Expert Testimony of J. Christopher A. Memorandum of Law in Support of Joint Motion of Class Plaintiffs and Individual Plaintiffs to Exclude The Expert Testimony of Professor Kevin M. Atkins 19.Case 1:05-md-01720-MKB-JO Document 6638-1 Filed 08/02/16 Page 7 of 12 PageID #: 88996 No. Murphy OPENING OPP REPLY SUR-REPLY 2011/02/11 2011/05/06 2011/06/30 n/a 2011/02/11 2011/05/06 2011/06/29 n/a 2011/02/11 2011/05/06 2011/06/30 n/a 2 . Memorandum of Law in Support of the Network Defendants’ Motion to Exclude the Damages Opinion of Dr.

Case 1:05-md-01720-MKB-JO Document 6638-1 Filed 08/02/16 Page 8 of 12 PageID #: 88997 EXHIBIT 3 .

Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document1656-1 6638-1 Filed Filed10/19/12 08/02/16 Page Page2 9ofof379 12 PageID PageID #: #: 34513 88998 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK IN RE PAYMENT CARD INTERCHANGE FEE AND MERCHANT DISCOUNT ANTITRUST LITIGATION No. DEFINITIVE CLASS SETTLEMENT AGREEMENT . 05-MD-1720 (JG) (JO) This Document Applies to: All Cases.

Within ten business days after the Settlement Preliminary Approval Date. If this Class Settlement Agreement terminates during the eightmonth period described in Paragraphs 12 and 13 below. 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. $2.000. (a) the Visa Defendants shall pay by wire transfer into the Class Settlement Cash Escrow Account(s). 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. two-thirds of $6. within sixty days of such termination.050.. 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.e.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document1656-1 6638-1 Filed Filed10/19/12 08/02/16 Page Page2510ofof379 12 PageID PageID #: #: 34536 88999 10.016.000.333). If this Class Settlement Agreement is not terminated prior to the commencement of the eight-month period described in Paragraphs 12 and 13 below. $4.000 (i. if the parties do not enter into a new Class Settlement Agreement addressing such distribution.000 (i.050. and in no event shall those Default Interchange Payments revert to the Visa Defendants or MasterCard Defendants or be distributed to Bank Defendants. 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. 21 .033. 11.333. 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)..e. 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 $6.667) in accordance with the agreement among themselves regarding their respective shares.666. from the litigation escrow account established under the Visa Defendants’ Retrospective Responsibility Plan.

The default interchange thus withheld or adjusted that is attributable to transactions of members of the Rule 23(b)(3) Settlement Class.e.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document1656-1 6638-1 Filed Filed10/19/12 08/02/16 Page Page2611ofof379 12 PageID PageID #: #: 34537 89000 12. and the Visa Defendants shall not be required to modify their default interchange rates in any manner not provided in this Paragraph. The Default Interchange Payment of the MasterCard Defendants shall be calculated as follows. During the time period of the interchange reduction provided in this Paragraph. shall constitute the Default Interchange Payment of the Visa Defendants.. For purposes of clarity. and sufficient to analyze and evaluate. if no such date exists. Within sixty days after the end of the Class Exclusion Period. 13. 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 22 . terminating on the same date of the month as the period commenced eight months earlier or. 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. no modification need be made to any Visa-Branded Debit Card default interchange rates or deposits into issuer accounts. that Default Interchange Payment. the first day of the following month) unless this Class Settlement Agreement is earlier terminated. 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. 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 Payment of the Visa Defendants shall be calculated as follows. The Visa Defendants shall identify and provide Class Counsel and the Class Administrator with data used to calculate. 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.

14. The default interchange thus withheld or adjusted that is attributable to transactions of members of the Rule 23(b)(3) Settlement Class. 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. exclusive of the transactions of the Individual Plaintiffs and Opt Outs. including but not limited to relief consisting of immediate payment. For purposes of clarity. and prior to the date of any termination of this Class Settlement Agreement during the eight-month period described in this Paragraph. no modification need be made to any MasterCard-Branded Debit Card default interchange rates or deposits into issuer accounts.. 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 23 . that Default Interchange Payment.Case Case 1:05-md-01720-MKB-JO 1:05-md-01720-JG-JO Document Document1656-1 6638-1 Filed Filed10/19/12 08/02/16 Page Page2712ofof379 12 PageID PageID #: #: 34538 89001 Paragraph on United States acquired and issued MasterCard-Branded Credit Card transactions for a period of eight months (i. and sufficient to analyze and evaluate. 15. 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. or if no such date exists. 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. interest.e. the first day of the following month) unless this Class Settlement Agreement is earlier terminated. and penalties. The MasterCard Defendants shall identify and provide Class Counsel and the Class Administrator with data used to calculate. During the time period of the interchange reduction provided in this Paragraph. and the MasterCard Defendants shall not be required to modify their default interchange rates in any manner not provided in this Paragraph. terminating on the same day of the month as the period commenced eight months earlier. shall constitute the Default Interchange Payment of the MasterCard Defendants.