A majority of plaintiffs in the retailer suit against Visa and MasterCard have opposed the proposed settlement, saying that it would allow the credit card industry to take advantage of American consumers and merchants.
The plaintiffs who oppose the settlement include Affiliated Foods Midwest, Coborn’s, Inc., D’Agostino Supermarkets, Jetro Holdings, Jetro Cash & Carry Enterprises, the National Association of Convenience Stores, the National Association of Truck Stop Owners, the National Community Pharmacists Association, the National Cooperative Grocers Association, the National Grocers Association and the National Restaurant Association.
Merchants said in a conference call hosted by several industry groups that the settlement favors lawyers, adding that it does not resolve the issue of unreasonable credit card processing fees, one of the merchants’ main issues of concern that prompted the lawsuit.
Doug Kantor, counsel to the National Association of Convenience Stores, said that it is “very unusual for lawyers to try to cram a settlement down the throat of their clients and the former clients they represent.”
Retailers filed suit against Visa and MasterCard in 2005, alleging that the card companies colluded to set interchange, or swipe fees, unreasonably high. Visa and MasterCard agreed to pay $6 billion to merchants and reduce interchange fees for eight months in a settlement valued at $7.25 billion. The settlement also allows merchants to charge a “checkout fee” to consumers who pay with plastic. The deal received initial approval from a federal judge on Wednesday.
Peter Larkin, the president and CEO of the National Grocers Association, said that the suit was designed to assist small businesses but instead places crippling restrictions on them. Larkin added that their counsel has “inadequately” addressed their concerns and misgivings about the issues related to the suit and settlement.
Dave Carpenter, the chairman of the National Association of Convenience Stores, said that the settlement “just makes surcharging the centerpiece, but that isn’t what this is about for small businesses,” adding that merchants “don’t want to surcharge [their] customers.”