ATLANTA (1/21/16)--In a conference call Wednesday afternoon, plaintiffs’ counsel in the Home Depot data breach suit alerted financial institutions--including credit unions--about alternate recovery offers (ARO) that may be submitted by Visa.
Financial institutions may be receiving settlement materials that include an ARO, which require the release of subsequent claims and have a Feb. 11 deadline. During the call, counsel noted that it believes the amount offered through the ARO falls short of what is appropriate for most institutions.
Financial institutions that decline the ARO preserve their ability to participate in any litigation recovery that might result from the class action matter, counsel said.
Plaintiffs’ counsel also alerted listeners that a similar settlement with MasterCard may be coming as soon as Jan. 25. Counsel will schedule an additional teleconference if that occurs.
It is important that credit unions are fully informed of their legal rights and should know that there is no guarantee that litigation will result in recovery greater than the ARO. However, some feel the recent Target settlement shows that institutions need not accept the first settlement offer offered to them.
A $39 million settlement between Target and financial institution plaintiffs was approved by the U.S. District Court of Minnesota in December, with a final hearing set for May 10.
The Credit Union National Association found credit unions alone were hit with nearly $60 million in costs after Home Depot’s 2014 data breach and $30.6 million after Target’s 2013 data breach.