Target’s proposed $19m settlement with MasterCard over the retailer’s data breach in 2013 has been voided as it did not receive enough support from the affected banks and credit unions.
The breach compromised 40 million credit and debit card accounts.
Target said that 90% of card issuers were required to go for the settlement by 20 May, but MasterCard informed the former that the threshold was not met.
MasterCard said that not enough issuers have approved the deal and it will continue work to resolve the issue.
According to plaintiffs, the settlement would cover only ‘pennies on the dollar’ for security breach losses. The legal counsel said it will push the lawsuit forward, seeking class-action status later this year.
National Association of Federal Credit Unions’ Government Affairs and General Counsel senior vice president Carrie Hunt said: "The failure to opt in to the settlement by financial institutions sends a strong signal to card companies that the current reimbursement system does not work and financial institutions need to be made whole."