The U.S. Supreme Court said Oct. 16 that it will hear an antitrust case examining American Express’s rules that bar merchants from encouraging customers to use one credit card over another, a practice known as "steering." The decision offers new hope to retailers who for years have argued that American Express’s merchant agreements violate antitrust laws and result in higher costs for consumers.
The Court is expected to hear arguments early next year and rule by June of 2018.
NATSO, along with the Merchants Payments Coalition, has long advocated for a number of credit and debit card fee reforms, including allowing retailers to ask consumers to use a card with lower interchange fees.
Allowing retailers to steer customers to less expensive cards would result in lower prices for consumers and a fairer market for the fees that merchants currently pay to accept credit and debit cards.
A federal district (trial) court in 2015 ruled that AmEx’s agreements constituted an unlawful restraint of trade after the U.S. Department of Justice (DOJ) and 11 states sued the credit card company over its merchant agreements and anti-steering policies. The plaintiffs argued that the anti-competitive nature of American Express’s rules violated U.S. antitrust laws.
A federal appeals court later reversed that decision, however, ruling that the plaintiffs had failed to prove that the AmEx rules harmed cardholders and merchants. The appeal from that unfavorable appeals court ruling is what the Supreme Court will consider next year.
DOJ did not join those 11 states in the latest appeal to the Supreme Court.
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