US government loses legal challenge to overturn AmEx antitrust case

1640 Views

A federal appeals court has rejected the US government’s AmEx antitrust case request that it reconsider its decision allowing American Express to stop merchants from encouraging customers to use rival cards that charge lower fees.

AmEx antitrust case

US government loses legal challenge to overturn AmEx antitrust case

That reversal by a three-judge panel allowed AmEx to block merchants that accept its cards from steering customers to rivals Visa and MasterCard, even if the move saved them money.

A spokesman for the US Department of Justice declined to comment. The government can still ask the US Supreme Court to take up the case. 17 US states also opposed AmEx’s anti-steering rules.

At issue were the more than $50 billion of fees that merchants pay annually to process transactions, and which can be passed along to customers through higher prices.

The Justice Department said the appeals court wrongly focused on how the company’s policy affected customers and merchants, rather than merchants alone.

It also said it should have been AmEx’s burden to show that its policy promoted competition, not the government’s burden to show otherwise.

Several dozen merchants including Kroger, Target and Walgreens Boots Alliance supported a rehearing by the original panel, or by all of the appeals court’s active judges.

Visa and MasterCard settled similar lawsuits in 2011 by agreeing to change their rules.

About Author

Leave A Reply