Under the settlement, announced late Friday after months of negotiations, merchants can charge higher prices to customers who pay with credit cards.
The New York Times reoprts that the lawsuit, which was brought in federal court on behalf of roughly seven million merchants, was initially filed in 2005.
According to a MasterCard spokesman, the defendants will together pay more than $6 billion to settle the case. “Our decision to settle is based on our belief that MasterCard and our stakeholders are best served by an amicable resolution,” Noah Hanft, MasterCard’s general counsel, said in a statement. MasterCard will pay $790 million.
In addition, MasterCard and Visa agreed to reduce the charge to process transactions for eight months. That fee reprieve is estimated by the plaintiffs to be $1.2 billion.
“We think this is a historic victory,” said K. Craig Wildfang, who represented the plaintiffs.
Retailers have battled to be able to charge more to customers who pay with credit or debit cards, a practice that Visa and MasterCard have banned until now. The retailers argue that the ability to do so would reduce their costs for accepting the cards and provide an incentive to pay cash.