December 22, 2009

Princeton, N.J.-based payment processor Heartland Payment Systems agreed to pay up to $2.4 million to settle a consumer cardholder class action suit for losses suffered following the criminal breach of its processing systems last year.

Heartland agreed to pay a minimum of $1 million to class members and take up settlement-related administration costs, including up to $1.5 million for the cost of notice to the settling class.

The company will pay up to $760,000 of the costs of attorneys representing the class members.

Heartland said it could terminate the deal if costs of notice exceeded $1.5 million, or if it received more than 2,500 requests for exclusion from the settlement class.

The deal settles all intrusion-related proceedings by consumers who used the payment cards between Dec. 6, 2007 and Dec. 31, 2008, including those who may allege to have suffered losses, the company said in a statement.

Meanwhile, Heartland has agreed to submit the report of an independent expert on its plans to improve the security of its computer system since the announcement of the cyber breach on January 20, 2009.

Last week, Heartland agreed to a $3.6 million settlement with American Express and is currently seeking to negotiate similar settlements with other schemes.

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in ...