Payment card issuer and processor Comdata has agreed to pay $100 million to settle claims that it inflated some of the fees it charges customers and put in place anticompetitive arrangements with three big truck stop operators.
The plaintiffs of a putative class action filed suit in early 2007 in Pennsylvania against Brentwood-based Comdata and its parent company Ceridian as well as TravelCenters of America, Pilot Travel Centers and Love's Travel Stops & Country Stores. Along with its payment, Comdata says it will change some of the terms of its merchant contracts, a move the plaintiffs say will improve their competitive environment. The other defendants in the case have agreed to pay another $30 million to settle the claims against them.
"We are very pleased to have reached an agreement that directly addresses merchant issues while continuing to emphasize and ensure fair treatment at the point of sale for fleets that carry the Comdata Card," said Comdata Chairman, President and CEO Stuart Harvey Jr. "While Comdata believes the lawsuit lacked merit, we decided to resolve the lawsuit so that we can continue to focus our full attention on strengthening and growing our relationships with our merchant and fleet customers."
The provisional settlement still needs to be finalized and approved by the court, which could take several months.
"The total cash recovery, together with the competition-enhancing prospective relief, will bring substantial value to the class members," said Eric Cramer, co-lead class counsel at law firm Berger & Montague in Philadelphia. "While we were confident in our ability to survive summary judgment, win at trial, and successfully defend that verdict on appeal, given that the settlements provide immediate, certain, and significant monetary compensation for past harms and real prospective relief to ameliorate future ones, this resolution is clearly in the best interests of our clients and the proposed class."