PNC, Small Businesses Reach $14.5M Class Action in Merchant Fee Class Action

PNC Merchant Fee Class Action Settlement Overview:

  • Why: PNC was accused of overcharging its merchant customers, adding fees that were not agreed upon.
  • Who: PNC Merchant Services and three small businesses reached a class action settlement.
  • Where: The class action settlement is pending in New York federal court.

PNC Merchant Services and several small businesses, after four years of “hard-fought litigation,” reached a $14.5 million settlement ending two class action lawsuits alleging it overbilled clients with credit card processing fees.

For starters, PNC will pay up to $10 million to over 200,000 Class Members and cover administration costs and attorneys’ expenses. The three lead plaintiffs, Anita’s Body & Skin Care, D.B. Kosie & Associates, and Choi’s Beer Shop, will also receive $10,000 each in service awards.

The small businesses filed the class action lawsuits after PNC allegedly charged annual fees and monthly paper statement fees that did not match with account agreements in violation of its contract.

PNC to Make Policy Changes to End Merchant Fee Class Action Lawsuit

Under the terms of the class action settlement, the financial company will also make changes to its small business financing practices.

PNC has agreed to provide customers with additional notice before imposing an annual fee, refrain from charging early termination fees, and obtain customers’ written consent before imposing monthly paper statement fees. PNC also agreed to allow customers to switch from a plan with an annual fee to one without an annual fee without penalty in future.

The settlement Class includes merchant customers that used PNC for payment card processing services and paid at least one of the fees (annual fees, early termination fees, and paper statement fees) between October 2011 and the date of the settlement’s approval.

Small businesses lodged a class action lawsuit against QuickBooks earlier this year after the accounting software provider allegedly ramped up fees on certain transactions without notice.

Credit card processing fees led to a historic class action settlement with Visa and MasterCard in 2013. Totalling more than $7.5 billion dollars, the deal benefited more than 12 million merchants who had allegedly been charged excessive credit card swipe fees.

Did you use PNC’s credit card services for your small business? Have you experienced something similar elsewhere? Let us know in the comments below!

The plaintiffs are represented by E. Adam Webb and Matthew C. Klase of Webb, Klase & Lemond LLC.

The PNC Merchants Fees Class Action Lawsuits are Kelwin Inkwell LLC, et al. v. PNC Merchant Services Co. LP, Case No. 1:17-cv-06255-FB-CLP, and Choi’s Beer Shop LLC v. PNC Merchant Services Co. LP, Case No. 1:19-cv-05768, both in the US District Court for the Eastern District of New York.

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