Majority of Plaintiffs Oppose Swipe Fee Settlement

Late last week, 10 of the 19 named class plaintiffs representing the class of all merchants announced their opposition to the proposed $7.25 billion settlement of a federal antitrust lawsuit over skyrocketing Visa and MasterCard credit card swipe fees. The proposed settlement of the case had been announced in July.

In a press release, the named plaintiffs said that they object to the proposed settlement, which is expected to be filed by tomorrow, because “rather than reforming the anticompetitive and illegal practices engaged in by the credit card industry, it will allow that industry to continue to take advantage of merchants and their customers while blocking competition and choice.” Over the last seven years, merchants and, ultimately, consumers have been charged $350 billion in swipe fees by the card companies.

The named class plaintiffs opposing the proposed settlement include Affiliated Foods Midwest; Coborn’s, Inc.; D’Agostino Supermarkets; Jetro Holdings, Inc. and Jetro Cash & Carry Enterprises; the National Association of Convenience Stores; NATSO (which represents truck stops and travel plazas); the National Community Pharmacists Association; the National Cooperative Grocers Association; the National Grocers Association; and the National Restaurant Association.

“The people asking the court to approve the proposed settlement simply do not represent the interests of most merchants, we do,” said Hank Armour, president and CEO of the National Association of Convenience Stores.

“This proposed settlement not only enables continued centralized price-fixing by Visa and MasterCard, but it prevents all current and future merchants, even those that are not yet in existence, from challenging actions in the future,” said B. Douglas Hoey, CEO of the National Community Pharmacists Association. “That is simply unfair.”

The remaining nine class plaintiffs are expected to file the proposed settlement by Friday, October 19, and to ask the U.S. District Court for the Eastern District of New York for preliminary approval. Opponents of the settlement will have 30 days in which to file declarations in opposition to the proposal.

The American Booksellers Association joined with the National Retail Federation, the Retail Industry Leaders Association, the National Association of College Stores, and other merchant trade groups in announcing their opposition to the swipe fee settlement last week.

More information about how booksellers can make their views on the proposed settlement known to the court will be available soon in Bookselling This Week.