AmEx Loses Anti-Trust Lawsuit

Marking a major victory for retailers, a federal court ruled Fed. 19 that American Express’ merchant agreements violate anti-trust laws, resulting in higher costs for consumers.

U.S. District Judge Nicolas Garaufis ruled that American Express violated U.S. anti-trust laws by barring merchants from encouraging customers to use one credit card over another, a practice that he said constitutes an unlawful restraint on trade.

The Merchants Payments Coalition (MPC), of which NATSO is a member, applauded U.S. District Judge Garaufis’ ruling, saying it marked “one step forward to bringing badly needed competition and transparency to the entire credit card industry.”

“Allowing retailers to ask consumers to use a less expensive card will result in lower prices for consumers and a fairer market for the fees merchants currently pay to accept credit and debit cards,” MPC said. “Judge Garaufis got it exactly right that card networks charge merchants inflated prices that result in higher costs for consumers.”

"Merchants across the country are thankful to the U.S. Department of Justice and to the judiciary for recognizing the anti-competitive nature of American Express’ rules and are hopeful that other steps will be taken to stop similar unfair practices of the other card companies who set outrageous fees behind closed doors for their real customers, the banks issuing the cards,” MPC said.  

MPC’s member trade associations represent almost 3 million stores with 50 million employees.

American Express said it plans to appeal to ruling, arguing that it will hurt competition by further entrenching the two dominant players, Visa and MasterCard.

 

Tiffany Wlazlowski Neuman's photo

Tiffany Wlazlowski Neuman

Tiffany Wlazlowski Neuman develops and executes communications strategies to advance NATSO’s public relations and advocacy goals. Tiffany also develops and oversees partnerships related to the NATSO Foundation’s public outreach initiatives. Tiffany lives in the D.C. metro area with her husband and their two sons.More
Source:
Web-Only Content

Tags

Tell Us What You Think

Back to Industry News