NRF files brief opposing class action settlement of swipe fee case
WASHINGTON — The National Retail Federation and more than a dozen retailers on Thusday asked a judge to reject a proposed class-action settlement of a federal antitrust lawsuit filed against Visa and MasterCard because of credit card swipe fees. The NRF suggested the settlement would not bring credit card swipe fees under control and does not give retailers who oppose it an adequate mechanism to opt out.
“The proposal pending before the court does nothing to keep these soaring fees from continuing to drive prices higher for American consumers, and would block merchants who believe in true swipe fee reform from ever having their day in court,” NRF SVP and general counsel Mallory Duncan stated. “While the remaining parties would like to treat preliminary approval as a routine procedural step, the court should recognize that this settlement is so legally flawed it cannot be tweaked into fairness," he said. “Instead of improving the situation, the proposed settlement would cast in stone the very problems that need to be fixed."
Nine merchants supporting the settlement filed a motion with U.S. District Court Judge John Gleeson in Brooklyn, N.Y., on Oct. 19 asking for preliminary approval of the proposal, and oral arguments are scheduled for Nov. 9.
Preliminary approval would begin a months-long process in which all retailers who accept Visa and MasterCard credit cards would be sent notices giving them the opportunity to either accept the settlement or opt out of part of it. Arguments on the merits of the settlement and whether it should be given final approval would not begin until sometime next year.
NRF is not a party to the suit, but represents retailers who would be affected if the case is approved as a class action. Retailers joining NRF in today’s brief included the following 17 companies and two associations that are not parties to the suit but would be affected: Abercrombie and Fitch, American Booksellers Association, American Signature, Ascena Retail Group, Big Lots Stores, Bob Evans Farms, Boscov’s, Chico’s, CKE Restaurants, Dillard’s, GAP, JCPenney, Limited Brands, Macy’s, the National Association of College Stores, Neiman Marcus Group, Papa John’s, Saks and Target.