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Legal Matters | 9 Months Ended
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Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract] |
Legal Matters | Note 13—Legal Matters The Company is party to various legal and regulatory proceedings. Some of these proceedings involve complex claims that are subject to substantial uncertainties and unascertainable damages. For those proceedings where a loss is determined to be only reasonably possible or probable but not estimable, the Company has disclosed the nature of the claim. Additionally, unless otherwise disclosed below with respect to these proceedings, the Company cannot provide an estimate of the possible loss or range of loss. Although the Company believes that it has strong defenses for the litigation and regulatory proceedings described below, it could, in the future, incur judgments or fines or enter into settlements of claims that could have a material adverse effect on the Company’s financial position, results of operations or cash flows. From time to time, the Company may engage in settlement discussions or mediations with respect to one or more of its outstanding litigation matters, either on its own behalf or collectively with other parties. The litigation accrual is an estimate and is based on management’s understanding of its litigation profile, the specifics of each case, advice of counsel to the extent appropriate and management’s best estimate of incurred loss as of the balance sheet date. The following table summarizes the activity related to accrued litigation:
| Nine Months Ended June 30,
| 2024 |  | 2023
| (in millions)
Balance as of beginning of period | $ | 1,751 |  |  | $ | 1,456 |
Provision for uncovered legal matters | 311 |  |  | 1 |
Provision for covered legal matters | 201 |  |  | 808 |
Payments for legal matters | (575) |  |  | (720) |
Balance as of end of period | $ | 1,688 |  |  | $ | 1,545 |
Accrual Summary—U.S. Covered Litigation Visa Inc., Visa U.S.A. and Visa International are parties to certain legal proceedings that are covered by the U.S. retrospective responsibility plan, which the Company refers to as the U.S. covered litigation. An accrual for the U.S. covered litigation and a charge to the litigation provision are recorded when a loss is deemed to be probable and reasonably estimable. In making this determination, the Company evaluates available information, including but not limited to actions taken by the Company’s litigation committee. The total accrual related to the U.S. covered litigation could be either higher or lower than the escrow account balance. See further discussion below under U.S. Covered Litigation and Note 5—U.S. and Europe Retrospective Responsibility Plans. The following table summarizes the accrual activity related to U.S. covered litigation:
| Nine Months Ended June 30,
| 2024 |  | 2023
| (in millions)
Balance as of beginning of period | $ | 1,621 |  |  | $ | 1,441 |
Provision for interchange multidistrict litigation | 140 |  |  | 797 |
Payments for U.S. covered litigation | (204) |  |  | (699) |
Balance as of end of period | $ | 1,557 |  |  | $ | 1,539 |
During the three and nine months ended June 30, 2024, the Company recorded additional accruals to address claims associated with the interchange multidistrict litigation. The accrual balance is consistent with the Company’s best estimate of its share of a probable and reasonably estimable loss with respect to the U.S. covered litigation. While this estimate is consistent with the Company’s view of the current status of the litigation, the probable and reasonably estimable loss or range of such loss could materially vary based on developments in the litigation. The Company will continue to consider and reevaluate this estimate in light of the substantial uncertainties with respect to the litigation. The Company is unable to estimate a potential loss or range of loss, if any, at trial if negotiated resolutions cannot be reached. Accrual Summary—VE Territory Covered Litigation Visa Inc., Visa International and Visa Europe are parties to certain legal proceedings that are covered by the Europe retrospective responsibility plan. Unlike the U.S. retrospective responsibility plan, the Europe retrospective responsibility plan does not have an escrow account that is used to fund settlements or judgments. The Company is entitled to recover VE territory covered losses through periodic adjustments to the conversion rates applicable to the series B and C preferred stock. An accrual for the VE territory covered losses and a reduction to stockholders’ equity will be recorded when the loss is deemed to be probable and reasonably estimable. See further discussion below under VE Territory Covered Litigation and Note 5—U.S. and Europe Retrospective Responsibility Plans. The following table summarizes the accrual activity related to VE territory covered litigation:
| Nine Months Ended June 30,
| 2024 |  | 2023
| (in millions)
Balance as of beginning of period | $ | 110 |  |  | $ | 11 |
Provision for VE territory covered litigation | 61 |  |  | 11 |
Payments for VE territory covered litigation | (146) |  |  | (19) |
Balance as of end of period | $ | 25 |  |  | $ | 3 |
U.S. Covered Litigation Interchange Multidistrict Litigation (MDL) - Class Actions On December 4, 2023, plaintiffs in the two actions led, respectively, by Hayley Lanning and Camp Grounds Coffee, served a motion for partial summary judgment. On January 8, 2024, defendants’ motions for summary judgment under Ohio v. American Express were granted in part and denied in part. On February 22, 2024, the district court denied defendants' motions for summary judgment based on the post-IPO conspiracy claims. On February 26, 2024, plaintiffs in the action led by Old Jericho Enterprise, Inc. served a motion for partial summary judgment. On March 11, 2024, the district court denied the Injunctive Relief Class plaintiffs’ motion for partial summary judgment. On April 2, 2024, the district court granted defendants’ motion for summary judgment on Injunctive Relief Class plaintiffs’ monopolization claims. On March 25, 2024, Visa and Mastercard entered into an agreement to resolve the Injunctive Relief Class claims (the “Settlement Agreement”), subject to court approval. The Settlement Agreement includes, among other terms, (i) a release from class members for claims for declaratory, injunctive or equitable relief arising out of conduct alleged by the Injunctive Relief Class in the litigation that have accrued or accrue in the future during the term of the Settlement Agreement; (ii) provisions requiring reductions and caps on U.S. credit interchange rates; and (iii) provisions requiring modifications to the Company’s rules in the U.S. that, among other things, streamline requirements for merchants who wish to impose a surcharge on credit transactions. On March 26, 2024, the Injunctive Relief Class plaintiffs filed a motion for preliminary approval of the settlement, which was denied on June 25, 2024. On May 28, 2024, the district court denied the Lanning and Camp Grounds plaintiffs’ motion for partial summary judgment, and the Lanning and Camp Grounds plaintiffs and another gasoline retailer have appealed. Interchange Multidistrict Litigation (MDL) - Individual Merchant Actions Visa has reached settlements with a number of merchants representing approximately 73% of the Visa-branded payment card sales volume of merchants who opted out of the Amended Settlement Agreement with the Damages Class plaintiffs. On November 1, 2023, defendants served a motion to enforce the Amended Settlement Agreement, or in the alternative for summary judgment, regarding claims in the actions brought by certain plaintiffs in their capacity as payment facilitators. On December 4, 2023, plaintiffs in certain of the individual merchant actions served a motion for partial summary judgment or a joinder in partial summary judgment motions. On January 8, 2024, defendants’ motions for summary judgment under Ohio v. American Express were granted in part and denied in part. On February 22, 2024, the district court denied defendants' motions for summary judgment based on Illinois Brick standing and on the post-IPO conspiracy claims, and denied as moot certain plaintiffs’ motions for partial summary judgment. On April 2, 2024, the district court granted in part and denied in part defendants’ motion for summary judgment on certain plaintiffs’ monopolization claims. On May 28, 2024, the district court granted defendants’ motion to enforce the Amended Settlement Agreement, and denied a motion by Intuit for partial summary judgment, regarding claims in the actions brought by certain plaintiffs in their capacity as payment facilitators. On July 8, 2024, the Judicial Panel on Multidistrict Litigation (JPML) remanded the action led by Grubhub Holdings Inc. to the U.S. District Court for the Northern District of Illinois. On July 17, 2024, the JPML remanded the actions led by Target Corporation and by 7-Eleven, Inc. to the U.S. District Court for the Southern District of New York. Consumer Interchange Litigation On February 9, 2024, defendants filed a motion to dismiss the complaint and to compel arbitration. VE Territory Covered Litigation Europe Merchant Litigation Since July 2013, proceedings have been commenced by more than 1,150 Merchants (the capitalized term “Merchant” when used in this section, means a Merchant together with subsidiary/affiliate companies that are party to the same claim) against Visa Europe, Visa Inc. and other Visa subsidiaries in the UK and other countries primarily relating to interchange rates in Europe and in some cases relating to fees charged by Visa and certain Visa rules. As of the filing date, Visa has settled the claims asserted by over 475 Merchants, and there are approximately 600 Merchants with outstanding claims. In addition, 30 additional Merchants have threatened to commence similar proceedings. Standstill agreements have been entered into with respect to some of those threatened Merchant claims, several of which have been settled. From February 14 to March 28, 2024, a trial occurred to consider whether certain interchange rates restrict competition in violation of UK antitrust law. In the class action claims filed before the UK Competition Appeal Tribunal (CAT), a class certification rehearing took place in April 2024. In June 2024, the CAT granted class certification in the claim regarding interchange fees on commercial credit cards. Other Litigation European Commission Interregional Interchange Investigation On July 5, 2024, the European Commission acknowledged a public undertaking from Visa that will extend the interregional interchange rate limits agreed in April 2019 for an additional five years, until November 1, 2029. The rate limits apply to consumer debit and credit cards issued outside the European Economic Area (EEA), when used at merchants located within the EEA. U.S. ATM Access Fee Litigation On May 2, 2024, in the consumer class action naming Visa, Mastercard and three financial institutions as defendants, Mackmin v. Visa Inc., et al., Visa and Mastercard entered a definitive class settlement agreement with plaintiffs in that action, subject to court approval. Plaintiffs in Mackmin filed a motion for preliminary approval of the settlement on May 29, 2024. The remaining consumer action, Burke v. Visa Inc., et a l., and the National ATM Council class action, are still pending. Pulse Network Visa has reached a settlement with Pulse and the suit has been dismissed. MiCamp Solutions On December 8, 2023, a complaint was filed in the U.S. District Court for the Northern District of California by MiCamp Solutions, LLC against Visa on behalf of a purported class of Independent Sales Organizations (ISOs) and their merchant customers and a purported subclass of ISOs. The complaint alleges violations of federal and state antitrust laws, state data privacy laws, and the constitution, based on, among other things, Visa’s interchange fees and its assessment of fees for non-compliance with its surcharge rules. The complaint seeks to recover damages and to enjoin the enforcement of Visa’s default interchange and surcharge rules, among other things. On March 5, 2024, MiCamp Solutions filed an amended complaint on behalf of the same purported class and subclass, and containing similar allegations as in the original complaint, and on March 19, 2024, Visa filed a motion to dismiss that amended complaint. Mirage Wine + Spirit’s Inc. On December 14, 2023, a putative class action was filed in the U.S. District Court for the Southern District of Illinois by Mirage Wine + Spirit’s Inc. against Apple Inc., Visa Inc. and Mastercard Incorporated on behalf of certain merchants in the United States that accepted Apple Pay as a method of payment at the physical point-of-sale from December 14, 2019. Plaintiff alleges a conspiracy under which Apple agreed not to enter a purported market for point-of-sale payment card networks services and seeks damages, injunctive relief and attorneys’ fees based on alleged violations of section 1 of the Sherman Act. On January 5, 2024, Visa requested transfer of the action to the U.S. District Court for the Eastern District of New York for coordinated or consolidated pretrial proceedings with the MDL. On February 2, 2024, the JPML entered a conditional transfer order conditionally transferring the case to the MDL. On February 26, 2024, plaintiffs filed a motion to vacate the conditional transfer order. On June 5, 2024, the JPML transferred the case to MDL 1720. On July 11, 2024, the JPML remanded the case to the U.S. District Court for the Southern District of Illinois. U.S. Income Tax Litigation On June 21, 2024, the Company filed a complaint against the United States in the U.S. Court of Federal Claims. The complaint challenges the denial by the IRS of certain income tax deductions from 2008 through 2015 related to software that the Company developed in the United States for utilization by Visa clients.

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