⚠ The Merchants Have Been Suing Since 2005Moderate threat

Mastercard (MA) — threat to the moat

Mastercard has been in court with American merchants for twenty years, and in April 2026 a new class action was filed.

American merchants first sued Mastercard over interchange in 2005, and the case has not ended. The litigation was split into a damages class and a rules-relief class; the damages class settlement was approved, with merchants representing slightly more than a quarter of volume opting out1. Mastercard has since settled with most of them, and settled matters now cover over 90% of its American interchange volume2. Under the settlement structure Mastercard pays 12% of any global settlement3.

US merchant interchange litigation2005first merchantsuits2018damages classsettlement2024rules settlementdeniedJune 2026revised settlement,preliminaryapprovalNovember2026final approvalhearingMastercard 10-K FY2025; Q2 2026 10-Q
Twenty years and still open.

What remains is still large. Seven opt-out merchants seek damages in excess of $1 billion4. A rules-relief settlement reached in 2024 was denied by the court; a revised settlement reached in November 20255 received preliminary approval in June 2026, with a final hearing scheduled for November 20266. And in April 2026 a new putative class action was filed seeking damages on credit interchange since January 20197.

Abroad the pattern repeats. In the United Kingdom the Merricks consumer action was settled for £200 million, $263 million8; other merchant claims and a commercial-card collective action remain open9. The United States Department of Justice has been investigating Mastercard's debit program since 202310, and Australia's competition regulator has a debit case whose liability hearing concluded in June 202611.

The accrual shows the scale of what has been paid. Mastercard's accrued liability for the American interchange litigation fell from $637 million at the end of 2025 to $149 million at 30 June 2026 after payments12. The provision for litigation was $504 million in 202513.

The rules-relief settlement is the one that changes the business rather than costing money, because it concerns how merchants can steer and surcharge. The final approval hearing in November 2026 is the date; approval on terms close to the preliminary ones would close the largest remaining uncertainty, and rejection for a second time would reopen it.

The number that tests this threat
Reported
Accrued US interchange litigation liability
$149M at 30 June 2026, from $637M at end-2025

What remains accrued after payments; a jump in the accrual would mean a remaining case has turned against Mastercard.

Source: Mastercard Form 10-Q, Q2 2026 ↗
References
  1. ReportedThe litigation was split into a damages class and a rules-relief class; the damages class settlement was approved, with merchants representing slightly more than a quarter of volume opting out.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  2. ReportedMastercard has since settled with most of them, and settled matters now cover over 90% of its American interchange volume.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  3. ReportedUnder the settlement structure Mastercard pays 12% of any global settlement.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  4. ReportedSeven opt-out merchants seek damages in excess of $1 billion.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  5. ReportedA rules-relief settlement reached in 2024 was denied by the court; a revised settlement reached in November 2025 received preliminary approval in June 2026, with a final hearing scheduled for November 2026.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  6. ReportedA rules-relief settlement reached in 2024 was denied by the court; a revised settlement reached in November 2025 received preliminary approval in June 2026, with a final hearing scheduled for November 2026.
    Mastercard Form 10-Q for the quarter ended 30 June 2026 - net revenue by category, rebates, litigation and the BVNK acquisition. — Q2 2026 · publ. 30 July 2026 · source ↗
  7. ReportedAnd in April 2026 a new putative class action was filed seeking damages on credit interchange since January 2019.
    Mastercard Form 10-Q for the quarter ended 30 June 2026 - net revenue by category, rebates, litigation and the BVNK acquisition. — Q2 2026 · publ. 30 July 2026 · source ↗
  8. ReportedIn the United Kingdom the Merricks consumer action was settled for £200 million, $263 million; other merchant claims and a commercial-card collective action remain open.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  9. ReportedIn the United Kingdom the Merricks consumer action was settled for £200 million, $263 million; other merchant claims and a commercial-card collective action remain open.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  10. ReportedThe United States Department of Justice has been investigating Mastercard's debit program since 2023, and Australia's competition regulator has a debit case whose liability hearing concluded in June 2026.
    Mastercard Form 10-K for fiscal 2025 - Item 1A risk factors and Note 19 legal and regulatory proceedings. — FY2025 · publ. 11 February 2026 · source ↗
  11. ReportedThe United States Department of Justice has been investigating Mastercard's debit program since 2023, and Australia's competition regulator has a debit case whose liability hearing concluded in June 2026.
    Mastercard Form 10-Q for the quarter ended 30 June 2026 - net revenue by category, rebates, litigation and the BVNK acquisition. — Q2 2026 · publ. 30 July 2026 · source ↗
  12. ReportedMastercard's accrued liability for the American interchange litigation fell from $637 million at the end of 2025 to $149 million at 30 June 2026 after payments.
    Mastercard Form 10-Q for the quarter ended 30 June 2026 - net revenue by category, rebates, litigation and the BVNK acquisition. — Q2 2026 · publ. 30 July 2026 · source ↗
  13. ReportedThe provision for litigation was $504 million in 2025.
    Mastercard fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99.1 - statements, cash flow and operating metrics. — FY2025 · publ. 29 January 2026 · source ↗
Sources
Generated September 25, 2026