Visa 2011 Annual Report Download - page 131

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2011
(in millions, except as noted)
On August 31, 2009, Visa entered into an agreement to prepay its remaining $800 million in settlement payments for $682 million. On October 2, 2009,
the court entered a final order approving the prepayment agreement, and Visa made the prepayment on October 5, 2009. Pursuant to its terms, the prepayment
agreement became final after no appeals to the approval order were filed within the 30-day appeal period.
"Indirect Purchaser" Actions. Complaints were also filed in 19 different states and the District of Columbia alleging state antitrust, consumer protection
and common law claims against Visa U.S.A. and MasterCard (and, in California, Visa International) on behalf of consumers. The claims in these class actions
included allegations mirroring those made in the U.S. merchant lawsuit and asserting that merchants, faced with excessive merchant discount fees, passed on
some portion of those fees to consumers in the form of higher prices on goods and services sold. Plaintiffs seek money damages and injunctive relief. Visa
U.S.A. has been successful in the majority of these cases, as courts in 17 jurisdictions have granted Visa U.S.A.'s motions to dismiss for failure to state a
claim or plaintiffs have voluntarily dismissed their complaints. In New Mexico, the court granted Visa U.S.A.'s motion to dismiss at a hearing on May 14,
2010, and entered an order and judgment dismissing the case on June 9, 2010. The plaintiff filed a notice of appeal from that order and judgment on June 14,
2010. Briefing is complete in the appeal, but no decision has been issued.
In California, in the consolidated Credit/Debit Card Tying Cases, the court dismissed claims brought under the Cartwright Act, but denied a similar
motion with respect to Unfair Competition Law claims for unlawful, unfair and/or fraudulent business practices. On October 31, 2007, the court denied the
plaintiffs' motion to give collateral estoppel effect to certain elements of their "tying" claim based on statements in the ruling on cross-motions for summary
judgment in In re Visa Check/MasterMoney Antitrust Litigation. On October 3, 2008, the parties agreed to confidential settlement terms to resolve the dispute.
A written settlement agreement executed on September 14, 2009, was submitted to the court for approval. After the parties amended the settlement agreement
in certain respects, the court entered an order preliminarily approving the settlement on January 5, 2010 and entered an order granting final approval on
August 23, 2010. The plaintiff in Attridge, who had filed objections to the settlement, filed a notice of appeal from the final approval order, as have other
objectors to the settlement. The amount of the settlement is not considered material to the consolidated financial statements.
Currency Conversion Litigation. In 2000, a "representative" action was filed in California state court against Visa U.S.A. and Visa International in
connection with an asserted 1% currency conversion "fee" assessed on member financial institutions by the payment card networks on transactions involving
the purchase of goods or services in a foreign currency and the disclosure of that fee (Schwartz). Plaintiffs claimed Visa's currency conversion practices
violated California Business & Professions Code Section 17200. Additional California state class actions were filed against Visa U.S.A. and Visa
International challenging currency conversion practices (Shrieve, Mattingly, and Baker). Visa U.S.A., Visa International, MasterCard, Citicorp Diners Club,
Inc. (Diners Club) and several Visa member financial institutions are also defendants in a number of federal class actions that allege, among other things,
violations of federal antitrust laws based on the 1% currency conversion fee. The federal complaints were consolidated or coordinated in MDL 1409 (In re
Currency Conversion Fee Antitrust Litigation) in the U.S. District Court for the Southern District of New York.
On July 20, 2006, Visa U.S.A. and Visa International entered into a settlement agreement in MDL 1409. Under the terms of that settlement, Visa
U.S.A. and Visa International paid $100.1 million
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