Merchants Appeal Preliminary Approval to Interchange Settlement
Nov. 29, 2012
This week, merchant groups filed an appeal in their long-running antitrust suit against Visa, MasterCard and many of the top U.S. issuing banks regarding how they set interchange rates. The merchants are appealing the preliminary approval that a federal judge earlier this month granted to a $7.25 billion settlement agreement . The settlement proposal, negotiated over nearly a decade, came under attack from many major retailers and merchant trade groups almost immediately after it was made public in July.
“This settlement has fatal legal defects and should not get preliminary approval,” said Jeff Shinder, a managing partner with Constantine Cannon LLP, which is representing the objecting plaintiffs, in a statement. “We look forward to presenting the problems we see in this proposal to the Second Circuit Court of Appeals.”
The most controversial concession merchants must make in return for the enormous payout (which would be spread out over hundreds of thousands of merchants that have taken credit-card payments between 2004 and this year) is abandoning the right to sue the credit-card industry over interchange issues essentially forever.