Bookstores to Receive Swipe Fee Notice of Settlement
ABA bookstore members should expect to receive a settlement notice soon as part of the proposed class-action settlement of a federal antitrust lawsuit over rapidly rising Visa and MasterCard credit card swipe fees. U.S. District Court Judge John Gleeson granted preliminary approval of the settlement in late November, and rule changes brought about by the settlement went into effect at the end of January.
The notice settlement offers merchants several options: to file a claim for monetary damages (equal to approximately two months’ worth of interchange fees); to opt out of the settlement; to object to the settlement; or to opt out and object to the settlement. The deadline to file is May 28, 2013.
The American Booksellers Association is currently working with a coalition of trade associations and companies to gather information as to the best course of action for ABA members. Member bookstores should expect more information regarding the swipe fee settlement within the next few weeks. Since filings are not due until May 28, ABA recommends that booksellers wait to make a decision until more information is available.
The $7.25 billion antitrust settlement is the largest in U.S. history, though the groups opposing the settlement argued that it amounts to less than two months’ worth of swipe fees, based on the estimated $50 billion in swipe fees collected by the credit card companies on an annual basis.
Judge Gleeson granted approval despite opposition to the settlement from 10 of the original 19 named class plaintiffs. In addition, three associations — the American Booksellers Association, the National Association of College Stores, and the National Retail Federation — and 17 retail and restaurant companies filed a brief in opposition to the settlement in early November.
According to the settlement notice, as of January 27, the settlement requires Visa and MasterCard to allow merchants to do the following:
- Charge customers an extra fee if they pay with Visa or MasterCard credit cards
- Offer discounts to customers who pay with payment forms less expensive than Visa or
- MasterCard credit or debit cards
- Accept Visa or MasterCard cards at fewer than all of the merchant’s trade names or banners
- Form “buying groups” that meet certain criteria to negotiate with Visa and MasterCard
Booksellers with questions about the settlement should contact ABA Senior Public Policy Analyst David Grogan at (800) 637-0037, ext. 7562, or via e-mail at email@example.com.