Tyro Payments (ASX: TYR) has decided to put to bed a class action brought by disgruntled merchants at the end of 2021 by offering a settlement ahead of the matter going to court.
Tyro announced this morning that it had reached the settlement following a court-ordered mediation.
The Federal Court class action was initiated after merchants claimed financial losses following a three-week outage of Tyro’s EFTPOS machines in January 2021.
The outage led to thousands of Australian businesses losing card payment capabilities for customer purchases, in some cases for weeks, with the problem identified by Tyro in specific versions of the terminal platform software supplied by Worldline, the manufacturer of the EFTPOS machines.
Despite Tyro announcing compensation packages for affected merchants, Sydney firm Bannister Law lodged the class action in the Federal Court on their behalf.
The class action alleged that Tyro engaged in “misleading and deceptive conduct, contravened certain statutory guarantees and breached certain contractual warranties".
Tyro denied the allegations at the time and had planned to defend the proceedings. The company made no provision for the claim in its FY22 accounts.
While Tyro has not revealed the sum of the agreed settlement, the company says the matter remains subject to court approval.
“Payment of the settlement amount is not expected to involve any additional cost or expense to Tyro,” says the company.
“In agreeing to resolve the class action, Tyro makes no admission as to liability.”
Get our daily business news
Sign up to our free email news updates.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support