Due to secret negotiations between opposing counsel, In re: American Express Anti-Steering Antitrust Litigation, 11-MD-2221., Eastern District Judge Nicholas Garaufis disallowed a settlement between American Express and retailers citing the "egregious conduct" by plaintiff's lead counsel Gary Friedman of the Friedman Law Group.
The Judge opined that "The improper and disappointing conduct of [Gary Friedman, Esq.] has fatally tainted the settlement process."
The decision is quite shocking, and the ruling describes and goes into details regarding communications between Gary Friedman, plaintiff's attorney, and Keila Ravelo, a former partner at Willkie, who represented Mastercard in separate, but similar litigation.
In December of 2014, the US Attorneys office in New Jersey brought charges against Ravelo for conspiracy to commit wire fraud, alleging that she and another party submitted fraudulent invoices to vendors in order to obtain over $5 million from Willkie, a former employer, and MasterCard. The investigation by the US Attorneys office lead to the discovery of the communications between Friedman and Ravelo, thereafter all the parties to the litigation were notified. Ravelo resigned from Willkie in November of 2014.
Ravelo and Friedman apparently had a professional relationship dating back to the 1990's when they worked together at Sidney Austin.
In American Express, there was an agreement in place that would have altered Amex rules regarding allowing merchants the ability to impose a fee to consumers for the credit and charge transactions, which would in theory cause the consumer to utilize their debit cards for purchases which were not subject to the fee. The result would allow merchants to charge consistent fees on credit or charge cards on all brands.
Under the settlement, American Express would have paid close to $100 million in attorneys fees.