A settlement offering credit unions and other card issuers pennies on the dollar for the losses they incurred because of Heartland Payment Systems’ 2008 card data security breach has come under fire by the three Houston law firms representing the issuers – Caddell & Chapman, the Coffman Law Firm and Chimicles & Tikellis.
The law firms also are critical of the fact that Heartland and Visa are pushing credit unions and other issuers to make a decision as to whether or not to accept the settlement within a matter of weeks. In addition, the settlement releases Keybank and Heartland Bank – Heartland acquiring banks – from liability for the security breach, with no contribution to the issuers’ losses.
“It certainly makes one wonder,” stated interim co-lead counsel Richard Coffman of the Coffman Law Firm, “why VISA would secretly negotiate a settlement on behalf of its issuers that lets the two richest potentially culpable parties off the hook with little, if any, financial investment and then force its issuers to decide within two weeks whether to accept the deal. If I were an executive of a financial institution harmed by the Heartland data breach, I would seriously question whether VISA truly has the best interests of its network members at heart.”
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