NEW YORK Numerous U.S. states this week joined big box retailers and merchant trade groups in objecting to a $7.25-billion Visa and MasterCard class action settlement.
The attorneys general of California, Ohio, Arizona and six other states are arguing the pending deal could strip them of their rights to sue the networks in the future. Forty-eight states and the District of Columbia signed a brief in support of the objections.
Retailers and trade groups argue Visa and MasterCard conspired to set fees at arbitrarily high levels and have prevented them from lowering their costs by imposing rules that merchants must abide by to accept their cards. They argue that the settlement attempts to block them from being future claims against the two card networks.
“As drafted, the settlement agreement opens the door for defendants to assert settlement releases against attorneys general or other law enforcement agencies in future law enforcement actions related to the payment card industry,” the states said in the filing Wednesday, which was the deadline for filing objections. The states said they have raised their concerns with parties to the settlement, but they have been “unwilling to modify” the settlement language.
The states said the agreement appears to release potential fines or other penalties that governments are able to bring on behalf of their citizens. The states asked that the language in the agreement be changed so that such claims are excluded.
