Walter Merricks CBE settles with Mastercard in multilateral interchange fee class action

Compass Lexecon provided economic expert advice to class representative Walter Merricks CBE in the context of his collective claim for damages against Mastercard on behalf of UK consumers. The class action litigation followed a European Commission decision that found that Mastercard’s multilateral interchange fees infringed EU competition law. In February 2025 the UK Competition Appeals Tribunal (“CAT”) approved a £200 million settlement agreed between Mr Merricks and Mastercard.

Situation

Following a 2007 European Commission decision, in which Mastercard’s multilateral interchange fees (“MIF”) were found to be anticompetitive, Walter Merricks CBE started collective action proceedings in 2016 seeking damages on behalf of approximately 46 million UK consumers. The claim was certified by the CAT in August 2021 as the first opt-out class action claim in the UK. Compass Lexecon was subsequently retained by Mr Merricks’ solicitors at Willkie Farr & Gallagher to provide economic expert evidence in the collective proceedings.

Our Role

A Compass Lexecon team assisted Mr Merricks’ legal team and Compass Lexecon testifying expert, Justin Coombs, providing economic analyses for the proceedings. We were involved in the assessment of the Value of Commerce (relevant to the calculation of consumers’ loss) and the relevant causal link between the levels of EEA MIFs and the level of UK domestic interchange fees. Mr Coombs testified on these topics at the Tribunal during the Causation and Value of Commerce trial in July 2023. We then prepared expert reports assessing acquirer pass-on (whether the unlawful fees resulted in higher charges for merchants) and merchant pass-on (whether the unlawful fees resulted in higher retail prices paid by consumers). We also responded to reports from the other parties’ experts. The Tribunal heard the pass-on issues in Mr Merricks’ claim alongside similar pass-on issues that arose in the Merchant Umbrella Proceedings. Mr Coombs testified at the Merchant Pass-on trial in November-December 2024, during an expert hot tub and extensive cross-examination.

Outcome

After more than eight years of litigation, the parties agreed on a settlement in December 2024. The CAT approved the settlement amount of £200 million in February 2025.

The team

The Compass Lexecon team was headed by Justin Coombs and Urs Haegler, and included Ian Small, Laura Rovegno, Joanna Hornik, Hamid Aghadadashli, Emmet Lenoach, Shikha Bhaskar, Balram Sennik, Tim Ciesla, Nikki Hui, Isaac Chilcott, Adrien Damade, Xinyan Lao, Megha Ranjan and Juan Wences. They assisted a team of Mr Merricks’ solicitors from Willkie Farr & Gallagher led by partners Boris Bronfentrinker and Nicola Chesaites, as well as barristers that represented Mr Merricks.