Vantiv Integrated Payments could pay $52 million to settle a class-action lawsuit that claims the company charged customers unauthorized and marked-up fees.
Businesses in Ohio, California and Tennessee claim that Mercury Payment Systems, a company founded in Durango, and a company it contracted with, Global Payments Direct, overcharged customers for the fees that major credit card companies require and imposed unauthorized fees.
The lawsuit, filed in 2016, claims that Mercury committed fraud, breach of contract, unjust enrichment and violated the state Racketeer Influenced and Corrupt Organizations Act. Vantiv bought Mercury in 2014, making it part of the case.
“Mercury (with the knowledge and assistance of Global) has for years carried out a widespread and systematic fraud on its customers. Without notice to merchants, Mercury has been surreptitiously and gradually inflating certain small, per-transaction fees,” court documents claimed.
The overcharged fees may add up to hundreds or thousands of dollars per merchant and tens or hundreds of millions of dollars in fraudulent profits, the claim states.
Mercury does not admit fault, but it agreed to settle the case to avoid the expense, risk, inconvenience and distraction of continuing the case, court documents state.
“We firmly believe that all of Mercury’s business practices were both legal and transparent,” said Adam Kiefaber, a spokesman for the company, in an email.
Those who used Mercury or were referred by Mercury to Global for payment processing from Oct. 9, 2009, through May 16, 2017, and paid certain fees could receive money or credit in the settlement, according to information provided by the settlement administrator.
A hearing scheduled for Aug. 26 will likely determine the amount owed to businesses in the settlement.
Prosecuting attorney Adam Levitt said in an email the settlement is an example of the positive effect of class-action litigation.
Several months after the lawsuit was filed, Mercury changed the worst of its practices and saved customers millions, he said.
“We believe that it is a well-thought-out, well-researched, well-documented and strongly and effectively litigated settlement that does a lot of good for a lot of hardworking, American small business owners and other merchants. We hope that the court agrees and grants final approval to this settlement at the end of the month,” he said in an email.