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A $30B antitrust settlement between Visa (NYSE:V), Mastercard (NYSE:MA) and U.S. merchants to limit credit-card swipe fees has been rejected by a federal judge in Brooklyn, New York, according to a Tuesday media report.
The move marks a major setback for the card networks in the two-decade long dispute over swipe fees.
At a hearing earlier in June, Judge Margo Brodie said she will “likely not approve the settlement” as it does not appear to provide sufficient relief. The credit-card firms subsequently said they were disappointed with the judge’s intention to block the deal.
Brodie officially issued the ruling Tuesday, and directed the parties to discuss and reply to the decision by June 28, Bloomberg reported.
Under the landmark deal, the companies agreed to reduce swipe fees for three years, and cap the rates for five years, with the moves estimated to deliver at least $29.79B in savings. The settlement aimed to resolve most claims in the nearly 20-year long litigation by merchants over high fees charged for processing card payments.
In late morning trading, shares of Visa (V) and Mastercard (MA) edged down 0.4% and 0.1%, respectively.