Visa, Mastercard $30 Billion Fee Settlement in Peril (yahoo.com) 15
Visa's and Mastercard's proposed $30 billion antitrust settlement to limit credit and debit card fees for merchants is in peril, after a New York judge signaled she was preparing to reject the accord. From a report: U.S. District Judge Margo Brodie in Brooklyn told lawyers for the card networks and objectors at a hearing on Thursday that she will "likely not approve the settlement," according to court records.
She plans to write an opinion explaining her decision and reasoning. Both card networks said they were disappointed. Mastercard called the settlement a "fair resolution" that gave businesses more flexibility in managing card transactions, and Visa called it an "appropriate resolution" to the nearly 19-year-old case.
She plans to write an opinion explaining her decision and reasoning. Both card networks said they were disappointed. Mastercard called the settlement a "fair resolution" that gave businesses more flexibility in managing card transactions, and Visa called it an "appropriate resolution" to the nearly 19-year-old case.
It's adorable (Score:4, Interesting)
that they issued two separate statements on the issue, like we're all supposed to believe that they don't collude so closely as to really be one entity.
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Re:Regret Looking It Up (Score:4, Insightful)
it might be that they have an equilibrium without any overt collusion
Who needs overt collusion when you can dial into to your "competitors" earning calls and copy all of their anti-consumer ideas? Netflix says on an earnings call they're going to crack down on password sharing, lo and behold, everyone else does the same. Verizon says they're going to raise prices, lo and behold, T-Mobile and AT&T do the same one quarter later.
They aren't in smoke filled rooms coming up with ways to screw the consumer. They're doing it in plain sight and we just bend over and take it.
Comment removed (Score:5, Insightful)
Must be the right move (Score:5, Insightful)
"Both card networks said they were disappointed."
The multi-billion-dollar, near-monopoly industries don't like it. This is a clear signal that it's the correct decision.
The $30 billion settlement is about 17% of what they collected in 2023 alone. It's not a punishment, it's a business expense.
=Smidge=
Re: Must be the right move (Score:3)
This. If the companies both call $30B a fair and appropriate penalty, then the one thing we can be absolutely sure of is that it is nothing worse than a slap on the wrist. As you said, a business expense, perhaps the equivalent of a rounding error.
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This. If the companies both call $30B a fair and appropriate penalty, then the one thing we can be absolutely sure of is that it is nothing worse than a slap on the wrist. As you said, a business expense, perhaps the equivalent of a rounding error.
"The National Retail Federation called the settlement 'manifestly insufficient' and its benefits 'meager and temporary,' saying it would still let Visa and Mastercard dictate swipe fees, and impose a 'virtually limitless' ban on future claims by merchants."
It seems obvious that the settlement is inadequate. As others here have pointed out, it's basically Visa and Mastercard paying a small fee ($30 billion dollars, which is equal to half of annual revenue or 79% of annual profit) plus a promise to temporari
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Look at it from the merchant's point of view, and it's a far worse settlement.
They offered to reduce fees by 0.04%. In order for a merchant to gain back $100 of being overcharged for fees over the last 20+ years, they would need $250,000 in credit card sales.
A $1 million in credit card sales per year business in the 5 years this settlement offered would stand to get back a grand total of $2,000.
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If the merchant doesn't want to pay the card network fees, they are free to not accept those forms of payment. They can collect cash and pay the expenses of dealing with cash. This may lose them customers, especially if their competition decides the card fees are worth it to keep the customers. I know not every vendor accepts every form of payment and there is no law that says you must accept Visa or Mastercard.
Big-company settlements are generally bad. (Score:5, Insightful)
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Pursue them to the absolute limit of your ability.
Conceptually, that sounds great. However, when you're suing a large company, your limit isn't nearly as high as theirs.
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Amen. Make 'em pay, till their dying day. The real cost of business...
Settlement was time-limited (Score:5, Informative)
This settlement *should* be rejected because it's only for five years. https://chainstoreage.com/nrf-... [chainstoreage.com] After that, they can go back to their same old tricks. Nice try, Visa and Mastercard.
Guess who's going to pay (Score:2)
The deal, which was announced in March and subject to court approval, would have let merchants charge consumers extra in transactions involving Visa or Mastercard credit cards.
The prices merchants charge won't go down, but they'll pass the 1-4% fee on to consumers. Good for businesses, VISA/MC still make their billions, and we all pay for it.