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WASHINGTON, D.C. -- In a move that does not come as a surprise, a majority of class plaintiffs involved in a swipe fee suit against Visa Inc. and MasterCard Inc. have filed a notice of appeal to challenge a federal's judge's preliminary approval of an estimated $7.2-billion settlement.
The merchant group will ask the U.S. Court of Appeals for the Second Circuit to deny preliminary approval due to the legal defects in the proposed settlement. The move comes nearly three weeks after U.S. District Court Judge John Gleeson made his ruling in U.S. District Court, Eastern District of New York in Brooklyn, N.Y.
As CSNews Online has been reporting since the proposed settlement was first struck in July, the retail community has been vocal in its opposition to the deal. NACS, the Association for Convenience & Fuel Retailing -- a plaintiff in the seven-year lawsuit -- was the first to speak out against the deal. Among other objections, the association said the agreement does not introduce competition and transparency into the credit card swipe fee market.
"This settlement has fatal legal defects and should not get preliminary approval. We look forward to presenting the problems we see in this proposal to the Second Circuit Court of Appeals," said Jeffrey Shinder, managing partner, Constantine Cannon LLC, counsel to the merchants objecting to the proposed settlement.
In addition to NACS, the named class plaintiffs opposing the proposed settlement of the case, which is known as "In Re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation," are Affiliated Foods Midwest, Coborn's Inc., D'Agostino Supermarkets, Jetro Holdings LLC, NATSO, National Community Pharmacists Association (NCPA), National Cooperative Grocers Association (NCGA), National Grocers Association (NGA) and National Restaurant Association (NRA).
"The merchant community is deeply committed to reforms that bring transparency and competition to the broken electronic payments market. The volume and diversity of those objecting to this flawed proposal is remarkable and continues to grow," Shinder said.
The named class plaintiffs were joined in multiple briefs filed with the court from a many other retailers, including nearly 1,200 small businesses and recognized brands such as 7-Eleven, Cumberland Farms, Dollar General, Giant Eagle, Kum and Go, Kwik Trip, RaceTrac Petroleum Inc., ShopKo, Starbucks, Target Corp., Wal-Mart Stores Inc., Wawa Inc., and Wendy's.