Visa Inc.
At issue in the suit are the card-swipe/interchange fees that card networks set and which merchants must pay to banks when consumers use their cards to shop. Merchants allege that the banks have colluded to inflate those fees. The class-action suit was initially brought up in 2005 but many large merchants opted out of the original $7.25 billion settlement reached in 2012 because of terms that they would not be allowed to file lawsuits against the networks regarding future swipe-fee increases. After they opted out, an appeals court invalidated the settlement, stating that merchants were not adequately represented.
Merchants paid card issuers $43.4 billion in Visa and Mastercard credit card swipe fees in 2017, up from the $25.9 billion they paid in 2012. The Dodd-Frank Act in 2010 capped pricing on debit-card swipe fees at no more than $10 billion in assets. Still, there has been a large increase in how much merchants have to pay banks and other networks.The increase is largely due to the gradual shift of consumers using cards for more of their purchases and the introduction of more high-cost cards with generous rewards programs. Several large merchants, including Home Depot Inc.
In their regulatory filings, Visa and Mastercard boosted their reserves in a litigation account by $600 million and $210 million, respectively, but did not state if this was related to the current settlement.
- https://www.wsj.com/articles/visa-mastercard-near-settlement-over-card-swipe-fees-1530193694
- https://www.reuters.com/article/us-visa-mastercard-settlement/visa-mastercard-close-to-settling-issues-over-card-swipe-fees-wsj-idUSKBN1JO220
- http://markets.businessinsider.com/news/stocks/wsj-visa-mastercard-near-settlement-over-card-swipe-fees-1027327600