OT: Visa & MasterCard lawsuit updategreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
I don't have a link for this (I don't know if it's at the WSJ online site). I received this in my e-mail, and didn't see any other mention of it.
[Educational/research purposes etc.]
JANUARY 25, 10:38 EST
Retailers Seek Debit Card Damages
NEW YORK (AP) - Wal-Mart and other large U.S. retailers are seeking $8.1 billion in damages from Visa and MasterCard for alleged debit card antitrust violations, The Wall Street Journal reported today.
In a lawsuit in U.S. District Court, the retailers accused Visa USA Inc. and MasterCard International of using monopoly power in credit cards to dominate debit cards, forcing them to pay high transaction fees and increase costs to consumers.
The damage estimate represents alleged overcharges by the credit-card companies since 1992. If the retailers win, the damage award would triple under antitrust law to $24.3 billion.
The retailers also are seeking an injunction to prevent the credit card companies from entering new markets, the Journal reported, citing a Dec. 20 letter from one of the defendants' lawyers. Wal-Mart has been joined in the lawsuit by Sears, Roebuck & Co.,Safeway Stores Inc., Limited Inc., Circuit City Stores Inc. and others.
U.S. District Judge John Gleeson has made a number of rulings in recent weeks that have accelerated the 3-year-old suit, and has set a Nov. 27 trial date.
Gleeson also approved a Justice Department request to review evidence with Wal-Mart's lawyers. The government last year opened its own probe of the debit card business and has already sued Visa and MasterCard for alleged antitrust violations in the credit-card industry.
The Wal-Mart suit accuses card issuers of using a monopoly in one market to enter another: tying new debit cards to credit cards and forcing merchants to accept them - and higher fees - in order to continue accepting credit cards. Wal-Mart says the credit card companies then charge retailers processing fees up to five times higher than those charged for traditional bank debit cards.
Visa and MasterCard deny the allegations.
Visa said the retailers' primary demand - that they not be forced to accept the debit cards - would ``undermine the entire premise on which the Visa system is based.'' A Visa spokesman said the ``honor all cards'' rule challenged in the lawsuit will be found lawful and pro-competitive.
A MasterCard spokesman said the lawsuit had no merit.
-- hanging (email@example.com), January 27, 2000