Walter Hugh Merricks CBE v Mastercard Incorporated & Ors
[2024] EWCA Civ 759
Visa Inc & Ors v Commercial and Interregional Card Claims I Limited & Anor
7 March 2024
[2024] EWCA Civ 218
Court of Appeal
Visa and Mastercard tried to appeal a court decision allowing a group lawsuit against them for allegedly overcharging merchants. The appeals court said the lower court made a fair decision, considering whether a group lawsuit or many individual lawsuits was better, and refused to overturn it.
Key Facts
- •Visa and Mastercard appealed a Competition Appeal Tribunal (CAT) decision refusing collective proceedings orders (CPOs) in litigation concerning alleged infringement of competition rules through multilateral interchange fees (MIFs).
- •The claimants, Commercial and Interregional Card Claims I & II Limited (CICC), sought CPOs on behalf of merchants for alleged overcharges.
- •The CAT initially refused CPOs due to insufficient focus, lack of methodology, and difficulty in identifying class members, but granted an eight-week period for revised proposals.
- •The appellants argued that individual proceedings were more suitable than collective proceedings, focusing on the scale and sophistication of class members, prior litigation, and cost-benefit analysis.
- •The CAT's judgment included a statement that it wasn't satisfied the suitability requirement was met, leading to a dispute on whether the suitability issue was definitively decided.
Legal Principles
A PCR must satisfy the CAT that they should be authorised to act as a class representative and that the claims they seek to combine and pursue are eligible for inclusion. Eligibility requires common issues and suitability for collective proceedings (section 47B(5) and (6) Competition Act 1998, Rule 79(1) CAT Rules).
Competition Act 1998, CAT Rules
When considering suitability, the CAT must consider factors such as whether collective proceedings are an appropriate means for fair and efficient resolution, costs and benefits, existence of separate proceedings, class size and nature, identifiability of class members, suitability for aggregate damages, and availability of alternative dispute resolution (Rule 79(2) CAT Rules). A comparison between collective and individual proceedings is required.
CAT Rules
The Court of Appeal will accord the CAT a broad margin of discretion over case management decisions. Undue formalism and precision are not required. The Court will be slow to interfere unless the CAT acted irrationally or made a material finding of fact based on non-existent evidence.
La Patourel v BT Group PLC and Another [2022] EWCA Civ 593, Evans v Barclays PLC and Others [2023] EWCA Civ 876
The rationale for collective proceedings is to provide a remedy to those who would not otherwise have one; however, this is just one factor among many to be considered when assessing suitability.
Merricks v Mastercard
Outcomes
Permission to appeal refused.
The CAT acted within its discretion. The appellants' arguments largely amounted to disagreements with the CAT's factual findings and conclusions on the suitability of collective versus individual proceedings, considering factors such as the ease of bringing individual claims, the potential costs, and the manageability of the litigation by the CAT. The CAT's consideration of the MIF Umbrella Proceedings as an alternative was appropriate.