James Musgrove

The plaintiffs brought a motion to approve settlements with National Bank, Visa, and MasterCard in a class action alleging a conspiracy to fix merchant discount fees.

The settlements provided for a total payment of $45 million, modifications to the 'No Surcharge Rule', and cooperation in the ongoing action against the remaining non-settling defendants.

Despite objections from Wal-Mart and Home Depot regarding the breadth of the releases, the court found the settlements to be fair, reasonable, and in the best interests of the class, particularly given the weaknesses in the plaintiffs' case against Visa and MasterCard under the Competition Act.

The court also approved Class Counsel's fee request.

Following a prior decision approving class counsel fees in a class proceeding settlement, class counsel sought clarification regarding the calculation of the fee award, treatment of consulting law firm fees, application of taxes, and comments regarding disclosure of a fee sharing agreement.

The court acknowledged that an arithmetic error had occurred in the original calculation and corrected the award by applying a 10% reduction to the claimed counsel fee before adding disbursements.

The court clarified that consulting law firms were to be paid from the approved counsel fee rather than treated as additional disbursements and confirmed that applicable taxes were payable in addition to the approved amount.

The court also addressed concerns about disclosure of the fee sharing agreement, reiterating that failure to fully disclose the agreement’s substance was a mistake despite counsel’s intentions.

Representative plaintiffs in a proposed national competition law class action sought court approval of partial settlement agreements with three defendants, approval of contingency fee agreements with class counsel, and approval of counsel fees and disbursements.

The court approved settlements totaling $13.63 million with Bank of America, Capital One, and Citigroup and found the agreements fair, reasonable, and in the best interests of the class under the Class Proceedings Act, 1992.

The court also approved the contingency fee agreements but scrutinized a separate fee‑sharing agreement between class counsel and a rival law firm that had commenced competing class actions.

The judge held that the fee‑sharing agreement required court approval, was not fair or reasonable to class members, and may constitute champerty or maintenance.

Class counsel’s requested fee was reduced by 10%, and the court ordered that no payment be made to the rival firm under the unauthorized agreement.