This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.
The U.S. Court of Appeals in New York City has denied a request for expedited review of the preliminary approval of a settlement that would resolve an antitrust action against Visa, MasterCard, and major U.S. financial institutions, resolving merchants' allegations that credit card issuers conspired to fix swipe fees, or charges that retailers pay to accept credit cards (In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, December 10, 2012).
The court denied the motion by Home Depot U.S.A., Inc. for expedited briefing, oral argument, and decision. An appeal will have to wait until after the federal district court in Brooklyn grants final approval to a settlement or has otherwise entered a final judgment.
On November 9, the federal district court granted preliminary approval of the proposed settlement. It also denied Home Depot's motion for certification for interlocutory appeal.
The settlement would provide an estimated $7.25 billion to the merchants who accepted Visa and MasterCard credit cards and debit cards in the United States since 2004. It would resolve the merchants’ claims that the payment card networks violated federal antitrust law by artificially inflating the interchange fees that the merchants paid on payment card transactions. The settlement is considered to be the largest ever in a private antitrust case.
The motion for preliminary approval was filed by mostly smaller merchants supporting the agreement. The National Retail Federation and a number of large retailers had asked the district court to reject the settlement. The trade group has said that the settlement is “unfair” and “does virtually nothing” to protect customers and address retailers’ concerns about credit card swipe fees charged by Visa and MasterCard.
The case is 05-MD-1720 (Docket Nos. 12-4671(L), 12-4708(Con), 12-4765(Con)).
Showing posts with label In re Payment Card Interchange Fee and Merchant Discount Litigation. Show all posts
Showing posts with label In re Payment Card Interchange Fee and Merchant Discount Litigation. Show all posts
Friday, December 14, 2012
Thursday, October 25, 2012
Court Sets Hearing on Preliminary Review of Credit Card Swipe Fee Litigation Settlement
This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.
The federal district court in Brooklyn, New York, has agreed to hear oral argument on a motion for preliminary approval of a proposed settlement that would resolve antitrust claims brought on behalf of approximately seven million merchants against Visa, MasterCard, and other major U.S. financial institutions over credit card swipe fees (In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, October 24, 2012, Gleeson, J.).
The settlement would provide an estimated $7.25 billion to the merchants who accepted Visa and MasterCard credit cards and debit cards in the United States since 2004. It would resolve the merchants’ claims that the payment card networks violated federal antitrust law by artificially inflating the interchange fees that the merchants paid on payment card transactions. The settlement before the court is considered to be the largest ever in a private antitrust case.
Noting that he did not ordinarily schedule oral argument of preliminary approval motions, Judge John Gleeson said that there was "an expectation among some interested parties that the preliminary approval process should be more involved in this case than in the usual class action." The court said, however, that the settlement agreement "at first blush . . . appears to satisfy the threshold requirements for preliminary approval."
The court is moving swiftly in its initial review of the settlement in the seven-year-old case. Oral argument has been scheduled for November 9.
The court denied requests from a large group of retailers and merchants for the formation of an objectors’ committee or to arrange for additional discovery. "The parties seeking that relief have a great deal of sophistication and familiarity with both the terms of the Settlement Agreement and the course of the negotiations that culminated in that agreement," the court said.
In addition, the court refused to establish procedures for absent class members to intervene at this juncture. They would have ample rights to be heard before final approval of the settlement was considered, the court explained.
The National Retail Federation is among the vocal opponents of the settlement. The trade group has said that the settlement is “unfair” and "does virtually nothing” to protect customers and address retailers’ concerns about credit card swipe fees charged by Visa and MasterCard.
The federal district court in Brooklyn, New York, has agreed to hear oral argument on a motion for preliminary approval of a proposed settlement that would resolve antitrust claims brought on behalf of approximately seven million merchants against Visa, MasterCard, and other major U.S. financial institutions over credit card swipe fees (In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, October 24, 2012, Gleeson, J.).
The settlement would provide an estimated $7.25 billion to the merchants who accepted Visa and MasterCard credit cards and debit cards in the United States since 2004. It would resolve the merchants’ claims that the payment card networks violated federal antitrust law by artificially inflating the interchange fees that the merchants paid on payment card transactions. The settlement before the court is considered to be the largest ever in a private antitrust case.
Noting that he did not ordinarily schedule oral argument of preliminary approval motions, Judge John Gleeson said that there was "an expectation among some interested parties that the preliminary approval process should be more involved in this case than in the usual class action." The court said, however, that the settlement agreement "at first blush . . . appears to satisfy the threshold requirements for preliminary approval."
The court is moving swiftly in its initial review of the settlement in the seven-year-old case. Oral argument has been scheduled for November 9.
The court denied requests from a large group of retailers and merchants for the formation of an objectors’ committee or to arrange for additional discovery. "The parties seeking that relief have a great deal of sophistication and familiarity with both the terms of the Settlement Agreement and the course of the negotiations that culminated in that agreement," the court said.
In addition, the court refused to establish procedures for absent class members to intervene at this juncture. They would have ample rights to be heard before final approval of the settlement was considered, the court explained.
The National Retail Federation is among the vocal opponents of the settlement. The trade group has said that the settlement is “unfair” and "does virtually nothing” to protect customers and address retailers’ concerns about credit card swipe fees charged by Visa and MasterCard.
Friday, September 14, 2012
Retail Group Vows to Block $7.25 Billion Swipe Fee Settlement
This posting was written by Sarah Borchersen-Keto, CCH Washington
The National Retail Federation said it would block a proposed $7.25 billion settlement involving Visa Inc., MasterCard Inc., and major banks for their role in allegedly fixing swipe fees, or the charges paid by merchants for accepting credit cards.
“NRF will take any and all steps necessary to oppose the settlement as it is currently proposed and will work toward real reform of the swipe fee system,” said NRF President and CEO Matthew Shay.
The group, which is not a party to the lawsuit, is currently exploring what form of legal action it might take. NRF noted that U.S. District Court Judge John Gleeson has not yet fully outlined how outside groups will be able to intervene, or if the case qualifies as a class action.
NRF argues that if the case actually went to trial and the verdict favored retailers, the judgment could total hundreds of billions of dollars, compared to the settlement total of $7.25 billion. Also, the proposed settlement does nothing to block future increases in swipe fees, the group claims.
NRF said it is particularly concerned by a provision that bars all merchants – even those that currently do not exist – from ever again suing Visa and MasterCard over swipe fees.
Last month the Retail Industry Leaders Association urged class plaintiffs to reject the proposed settlement, citing concerns that it would limit their future legal options and preserve the Visa/MasterCard duopoly. Other groups expressing concern with the settlement include the National Association of Convenience Stores and the National Grocers Association.
As the world’s largest retail trade association and the voice of retail worldwide, NRF represents retailers of all types and sizes, including chain restaurants and industry partners, from the United States and more than 45 countries abroad.
Further details regarding In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation appears in a July 16, 2012 posting on Trade Regulation Talk.
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