NEW YORK The landmark antitrust settlement with Visa and MasterCard took another turn last week with a new antitrust suit filed against the credit card giants by 7-Eleven stores and 30 other major merchants, including Amazon, Costco, Crate & Barrel, Dick’s Sporting Goods, Foot Locker, the Gap and Panera Bread.
As in two other new antitrust suit filed by CVS, Target and several other merchants, the new action seeks out to stake out legal ground in case a federal judge approves the $7.2-billion antitrust settlement that could bar any additional antitrust claims by the merchants. These retailers have opted out of the landmark antitrust settlement, but worry they would be bound by the terms of the deal if it is approved by the judge. A federal judge has issued preliminary approval of the settlement and has scheduled a hearing for September, where a final ruling is expected.
Among the retail giants that have joined one of the new antitrust suits are: Macy’s, ShopRite, Children’s Place, Costco, IKEA, Lowe’s, Michael’s, Ralph Lauren, Bloomingdale’s, Kohl’s, Staples, JC Penney’s and TJX Cos.
The 7-Eleven suit claims Visa and MasterCard, who control about 80% of the cards market, use their market power to set interchange rates.
“Once Visa and MasterCard acquired substantial market power over merchants, they maintained it by forcing merchants to pay even higher interchange fees to continue to fund these price-fixing schemes,” the retailers said in the complaint filed in the U.S. District Court for the Eastern District of New York.
The merchants say the proposed settlement, which would pay $7.2 billion to approximately 8 million merchants, and provide another $1.2 billion in fee rebates, is not generous enough, and does not prevent the two cards giants from continuing to exercise their market clout in setting interchange rates.
