News

NRF files formal appeal of controversial antitrust ruling

January 3, 2014

Two weeks before Christmas, when the ruling in a controversial antitrust lawsuit settlement covering credit card swipe fees came down in favor of Visa and MasterCard, retailers essentially told the court, "Bah! Humbug," giving immediate notice of their intent to appeal. Yesterday, the National Retail Federation kicked off the new year by filing formal papers with the court and issuing a statement to back their play.

... The settlement does nothing to reform the price-fixing payments system that has let credit card swipe fees skyrocket over the past decade and nothing to keep them from continuing to soar in the future.Instead of lowering fees, the card industry’s settlement proposes that merchants pass them along to consumers in the form of surcharges. That is absolutely the opposite of what retailers sought, and major retailers have soundly rejected surcharging.

... A majority of the original plaintiffs in the case repudiated the settlement as soon as they saw its terms, the nation’s largest retailers have spoken out against it, and close to 8,000 retailers and merchants have formally rejected the proposal. This is an abuse of the class action system and should never have been approved.

The only people pleased with this settlement are Visa and MasterCard, because it means they can continue collecting tens of billions of dollars in hidden fees, the class action lawyers who stand to collect half a billion dollars in fees without fixing the problem, and a lower court, which has cleared a time-consuming case off its docket, but has done a serious disservice to merchants and the public in the process.

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