Retailers to Appeal $7.25 Billion Swipe Fee Settlement

Retailers continue to fight hard against the $7.25 billion interchange fee settlement between merchants and Visa, MasterCard and several banks.

On Tuesday, ten merchants and trade groups filed notice that they will challenge the settlement of this swipe fee price-fixing case in a federal appeals court. The deal had been tentatively approved by Judge John Gleeson in a U.S. District Court on November 9.

If the settlement is approved, it would be the largest federal antitrust settlement in U.S. history.

Retailers say the settlement prevents them from opting out of the pact, which is a violation of their rights. They are challenging a part of the order that would free Visa and MasterCard from new legal claims over related interchange issues.

Over half of the stores and trade groups that brought the proposed class action now oppose the pact, including the National Association of Convenience Stores, the National Restaurant Association, and the National Grocers Association. It is also opposed by a substantial number of merchants, including the world's two largest retailers, Walmart and Target.

The case began in 2005 when retailers filed complaints against Visa, MasterCard and other credit card companies, accusing the issuers of collaborating to fix the interchange or swipe fees they charge merchants for accepting credit cards.

The proposed agreement was reached in July when MasterCard, Visa and major banks agreed to pay more than $6 billion to resolve accusations that they engaged in anti-competitive practices and price fixing in payment processing. In addition, credit card companies agreed to reduce swipe fees for eight months, an adjustment valued at $1.2 billion.

The settlement would also allow retailers to charge higher prices to their customers for paying with credit cards. Before this settlement, the card companies prohibited retailers from adding this type of surcharge.

A hearing on final approval is expected to be scheduled for sometime next year.


This entry was posted in Credit Card News and tagged , , , , , , , , , , by Natalie Rutledge. Bookmark the permalink.
The information contained within this article was accurate as of November 28, 2012. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website.
Editorial Disclosure
LowCards.com is an independent, for-profit web site. LowCards.com participates in the Affiliate Network, and receives compensation from most of the credit card issuers whose offers appear on the site. This compensation helps support our website and enables us to write insightful articles to help you manage your credit card accounts. This compensation, as well as the likelihood of applicants’ credit approval and our own proprietary website guidelines, may impact how and where the cards appear on our site.

LowCards.com does not include all credit card companies or every available credit card offer. Opinions expressed here are author’s alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. Every reasonable effort has been made to maintain accurate information, however credit card offers change frequently. After you click on an offer you will be directed to the credit card issuer’s secure web site where you can review the terms and conditions for your offer.

About Natalie Rutledge

Natalie Rutledge majored in Communications at Mississippi State University. She was in sales for a number of businesses and spent nine years working as a communications advisor to various entities. Natalie can be contacted directly at [email protected]