Fleet payment card issuer Comdata and three travel plaza chain operators have agreed to pay $130 million in settlement of a class-action lawsuit filed nearly nine years ago on behalf of independent travel plaza owners.
If a court approves the proposed agreement, Comdata will pay plaintiffs a total of $100 million, with $10 million paid by TravelCenters of America LLC, according to press releases from both companies. The remaining $20 million would be paid by defendants Pilot Travel Centers LLC, and Love’s Travel Stops and Country Stores Inc. in undisclosed shares.
In addition to the monetary payment, the settlement will require Comdata to change “certain allegedly anticompetitive business practices” as outlined in its merchant agreements, according to Lieff Cabraser Heimann & Bernstein, co-lead counsel for the plaintiffs.
Though the specific changes have not been publicly disclosed, counsel for the plaintiffs said they are designed to give greater negotiating power to independent travel plaza operators and “buying groups.”
Stuart C. Harvey, Jr., chairman, chief executive officer and president of Comdata Inc. stated, “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. 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 lawsuit alleges that beginning around 2000, Comdata began charging independent truckstop operators “500 to 1,000 percent more” than chain defendants per transaction. Plaintiffs say that Comdata charged the chains lower fees largely to ensure they would not accept rival fleet card TCH or promote their own rival cards.
The proposed settlement is expected to be filed in U.S. District Court for the Eastern District of Pennsylvania on Feb. 28. Class members (independent travel plaza and truckstop operators who accepted the Comdata card) will be eligible to participate in the settlement as part of the class. It is not yet known, however, exactly how the $130 million will be distributed among the class members.
Following the court’s preliminary approval of the agreement (which could occur sometime in March), independent operators will receive instructions on how to file a claim or opt out of the settlement.
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