The Competition Appeal Tribunal has handed down judgment in Walter Hugh Merricks CBE v Mastercard Incorporated and Others [2024] CAT 41 holding that the first five years of the Merricks’ class action is time-barred, rejecting Mr Merricks’ case under section 32 of the Limitation Act 1980 that Mastercard deliberately concealed relevant facts or deliberately committed a breach of duty.
On 19 December 2007, the European Commission found that Mastercard had infringed Article 101 TFEU by reason of its cross-border EEA multilateral interchange fees (“EEAMIFs”), which had since May 1992 been charged by cardholders’ banks (“issuing banks”) to merchants’ banks (“acquiring banks”) in breach of competition law. Mr Merricks has brought a class action on behalf of a vast number of consumers arguing that: (a) the unlawful EEA MIFs resulted in an overcharge on UK domestic and cross-border interchange fees paid by acquiring banks in the UK; (b) this overcharge was passed on by acquiring banks to merchants via a merchant service charge; and (c) merchants in turn passed on that overcharge to consumers, by charging higher prices for all their goods and services.
The class on behalf of which these proceedings are brought comprises all individuals who, between 22 May 1992 and 21 June 2008, when aged 16 and above and resident in the UK, purchased goods and/or services from businesses selling in the UK that accepted Mastercard cards. The class is accordingly estimated to number some 45.5 million people, and the amount sought as aggregate damages stands at some £10bn. It has been described, on any view, as a “gargantuan” and “massive” set of litigation.
The latest stage of the proceedings concerns Mastercard’s limitation defence. Mastercard contended that insofar as claims are governed by English or Northern Irish law, those occurring before 20 June 1997 are time barred under ss.2/9 of the Limitation Act 1980. Mr Merricks contended that the usual six-year limitation period was suspended pursuant to s.32(1)(b) or s. 32(2), because Mastercard had deliberately concealed facts relevant to the consumers’ causes of action and/or had deliberately committed a breach of duty by intentionally infringing competition law. Alternatively, Mr Merricks argued that the EU principle of effectiveness meant no limitation period could begin to run before the class members knew, or could reasonably be expected to have known: (a) the existence of the infringement, (b) the existence of the harm they suffered, (c) the causal link between that harm and the infringement, and (d) the identity of the perpetrators of the infringement.
Mastercard succeeded on every argument. The Tribunal found that no relevant facts had been deliberately concealed by Mastercard, and that Mastercard did not deliberately commit any breach of duty. Quite the contrary; Mastercard had believed its conduct was lawful at the time, and it had argued for its position before the European Commission and then through each stage of the European appeal court system. The Tribunal also found that the EU principle of effectiveness did not preclude or modify any of the usual limitation rules under English law.
As a result, the Tribunal concluded that English (and Northern Irish) claims are time-barred in respect of any loss suffered by the class members before 20 June 1997. As the Tribunal recognised, this is “undoubtedly of great practical significance” since it accounts for five out of the 18 year claim period.
Sonia Tolaney KC, Timothy Otty KC, Matthew Cook KC and Daniel Benedyk appeared for the successful defendant, Mastercard, instructed by Freshfields Bruckhaus Deringer LLP.
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