Mastercard Refund Lawsuit Ruling: Funder Challenges Damages Distribution

In a case that could change how big companies handle refunds, Mastercard is facing serious trouble. A UK court has ruled in a huge lawsuit claiming that Mastercard overcharged millions of people. The total payout could be over £10 billion. That’s a lot of money, and many people are waiting to get their share.

But now, there’s a new twist. The company that helped fund the lawsuit is not happy. They’re questioning how the money will be divided. They want a bigger piece of the pie and are challenging the court’s decision on who gets paid and how much.

This isn’t just about Mastercard. It’s about how justice works in large group claims. As we follow this case, we see how legal funding, consumer rights, and fairness all come into play. Let’s break it down together.

Background of the Mastercard Lawsuit

In 2016, ex‑ombudsman Walter Merricks started the lawsuit. It targeted Mastercard’s interchange fees, saying these forced retailers to raise prices, and shoppers paid the cost. At its peak, the case sought up to £14 billion in damages. The scale was massive, involving nearly 44 million UK consumers.

Court Ruling Summary

In spring 2025, the Competition Appeal Tribunal (CAT) approved a £200 million settlement. The first £100 million is for consumer payments. Based on expected participation, individuals may get between £45 and £70.

Role of the Litigation Funder

Innsworth Capital financed the lawsuit, putting in around £46 million. Funders like Innsworth expect a return, often multiple times their investment, if the case succeeds.

Damages Distribution Controversy

Here’s how CAT planned to split the money:

• Pot 1: Pot 1 (£100m)goes to consumers.
• Pot 2: Pot 2 (~£45.6m)repays Innsworth’s costs.
• Pot 3: Pot 3 (~£54.4m)covers the funder’s profit, extra consumer pay if needed, then the leftover goes to charity.

CAT approved a 1.5× return for Innsworth, about £22.8 million. But Innsworth says that’s too low. They claim the charity Access to Justice Foundation (AtJF) may get around £30 million, more than they will, despite bearing full risk. Innsworth is now seeking judicial review of the distribution plan.

Legal and Financial Implications

If funders are denied fair returns, they may back fewer cases in the future. Innsworth argues that the low payout could scare away investors. Legal experts warn that this could hurt class‑action funding in the UK.

Public and Expert Reactions

Consumers are hopeful for a refund, “better than a slap in the face,” as one paper put it. Merricks supports the settlement but says Innsworth’s tactics are unfair. Innsworth counters that the payout is “unreasonable” and vowed to fight. Some experts warn that the dispute threatens the future of collective actions.

What Happens Next?

Innsworth is seeking judicial review in the High Court. That could delay payments to consumers. If successful, funds may need reallocation. If not, payouts should begin later this year.

At the same time, the Civil Justice Council is examining the rules around how litigation funding works.. Its findings, expected later in 2025, may influence policy.

Conclusion

This case blends consumer claims, legal funding, and fairness under one roof. The £200 million deal may not match initial expectations, but it still offers real refunds to millions. As we watch the funder’s challenge unfold, we’re seeing a test of how justice and funding models coexist in big group lawsuits.

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