MANHATTAN (LN) — U.S. District Judge Lewis Cogan on Thursday adopted a magistrate judge’s recommendation to sanction Betz & Baril PPLC and ClickFunds LLC for misleading thousands of class members card interchange fee litigation, rejecting the firms’ constitutional and statutory objections.
The court determined that Betz & Baril, which provides claim-filing services to about 9,000 class members, incorrectly told clients that sales volume data from transactions involving Square, Inc., now known as Block, Inc., could not be considered as part of their claims.
For at least one class member, the misinformation resulted in a difference of $2.3 million in sales volume previously omitted from its claim.
Class Counsel had sought punitive sanctions that would have barred the respondents from receiving any portion of class members’ settlement benefits and forbidden future participation in the case. Magistrate Judge Joseph Marutollo instead recommended remedial sanctions.
Under the adopted order, Betz & Baril must notify all affected clients about the misinformation regarding Square and offer them an option to cancel their contracts. If any class members cancel, the claims-filing period will be reopened for those individuals, allowing them to re-file claims with the court-appointed administrator. The associated fees and costs will be shifted to the respondents.
Respondents objected to the sanctions, arguing they violated the All Writs Act and the Due Process Clause of the Fifth Amendment. Judge Cogan reviewed the objections for clear error, finding the respondents’ arguments were conclusory and failed to target specific findings in the magistrate judge’s report.
The court rejected the All Writs Act challenge, characterizing the sanction as a “prototypical curative order” necessary to protect class members who were also Betz & Baril clients. The court also dismissed the due process argument, noting that the Second Circuit has consistently upheld similar compelled communications without constitutional concern.
This is not the first time the court has policed conduct connected to Jason Baril, an attorney and principal of Betz & Baril. In 2019, an entity operated by Baril was ordered to show cause regarding false statements on a website and social media. In 2024, Betz & Baril and ClickFunds faced similar orders over misleading YouTube videos, resulting in stipulations that allowed about 1,700 clients to cancel contracts.
The current sanctions follow a pattern of remedial orders in the litigation. In 2024, the court recommended that National Processing Alliance provide merchants with notice that they may cancel their contracts and file their own claims, using language approved by Class Counsel.
Betz & Baril’s subset of about 9,000 clients represents approximately 0.075 percent of the 12-million-member class card antitrust litigation.