Visa 2010 Annual Report Download - page 131

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2010
(in millions, except as noted)
U.S.A. and Visa International also paid into the settlement fund $18.6 million in attorneys' fees to resolve Schwartz. The Shrieve, Mattingly, and Baker
plaintiffs agreed that they would ask the court to dismiss their actions with prejudice as to Visa U.S.A. and Visa International once the MDL 1409 settlement
receives court approval. If Baker is dismissed, Visa U.S.A. and Visa International shall pay $1.0 million plus interest as attorneys' fees. If Baker is not
dismissed within 60 days of final approval of the MDL settlement, Visa U.S.A. and Visa International shall pay $500,000 plus interest as attorneys' fees.
The court granted final approval of the MDL 1409 settlement on October 22, 2009. Various appeals have been filed with the U.S. Court of Appeals for
the Second Circuit challenging the district court's approval of the settlement. The issuance of refund checks for valid, timely claims will not commence until
after the appeals are resolved (in favor of the court-approved settlement) and the settlement administrator has validated the claims.
Morgan Stanley Dean Witter/Discover Litigation. In August 2004, the European Commission in Brussels issued a Statement of Objections against Visa
International and Visa Europe alleging a breach of European competition law. The allegation arises from the Visa International and Visa Europe Rule (bylaw
2.12(b)) that makes certain designated competitors, including Morgan Stanley Dean Witter/Discover, ineligible for membership. On October 3, 2007, the
European Commission fined Visa International and Visa Europe €10.2 million ($14.5 million) for infringing European Union rules on restrictive business
practices (Article 81 of the EC Treaty and Article 53 of the EEA Agreement). Visa International and Visa Europe filed an appeal of the ruling with the Court
of First Instance on December 19, 2007. A hearing on Visa International and Visa Europe's appeal before the General Court (formerly known as the Court of
First Instance) was held on May 20, 2010. No ruling has been issued. Pursuant to existing agreements, Visa Europe has acknowledged full responsibility for
the defense of this action, including any fines that may be payable.
Merchant Acceptance Rules Investigations. On October 10, 2008, the United States Department of Justice (the "DOJ") issued a Civil Investigative
Demand, or "CID," to Visa U.S.A. that sought information regarding a potential violation of Section 1 or 2 of the Sherman Act, 15 U.S.C. §§ 1, 2. The CID
sought documents, data and narrative responses to several interrogatories and document requests, which focused on certain merchant acceptance practices,
including major payment network rules regarding merchant surcharging and merchants' ability to steer customers to other forms of payment.
On May 15, 2009, the Office of the Attorney General for the State of Ohio issued an Investigative Demand to Visa Inc. seeking information regarding a
potential violation of Chapter 1331 of the Ohio Revised Code, Ohio's antitrust law. The Ohio Attorney General is part of a multistate attorney general working
group. The Investigative Demand sought copies of documents, data and narrative responses that Visa had produced to the Division pursuant to the CID issued
on October 10, 2008. The Investigative Demand focused on certain Visa U.S.A. policies relating to merchant acceptance practices, including Visa U.S.A.'s
policies regarding merchant surcharging and merchants' ability to steer customers to other forms of payment.
On October 4, 2010, Visa announced a settlement with the DOJ and the attorneys general of seven states to resolve their investigations. As part of the
settlement, Visa will allow U.S. merchants to offer discounts or other incentives to steer customers to a particular form of payment including to a specific
network brand or to any card product, such as a "non-reward" Visa credit card. Visa's rules
130