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A San Diego pizzeria has filed a proposed class action accusing Visa, Mastercard and five major banks of suppressing competition over credit-card fees charged to merchants. The complaint seeks to represent U.S. merchants that accepted Visa or Mastercard cards from Jan. 25, 2019, onward; its allegations have not been established in court.
A San Diego pizzeria has filed a proposed class action accusing Visa, Mastercard and five major banks of working to keep fees merchants pay on credit-card transactions artificially high. The 134-page complaint seeks to cover merchants that accepted the networks’ cards in the United States from Jan. 25, 2019, and says earlier settlement relief did not compensate them for fees paid after that date. The claims remain allegations, not court findings.
The lawsuit names Bank of America, Capital One, Chase Bank, Citibank and Wells Fargo alongside the two card networks. It alleges the defendants have coordinated or maintained rules that limit competition in the setting of interchange fees—charges merchants pay to banks that issue credit cards. According to the complaint, Visa and Mastercard set uniform fee schedules with the banks, leaving merchants with little ability to negotiate.
The filing says rules requiring merchants that accept one Visa or Mastercard credit card to accept all cards on that network weaken incentives for issuing banks to compete by reducing fees. It also alleges merchants have been restricted from steering customers toward cheaper payment methods, including through surcharges tied to card use. The complaint further claims Visa and Mastercard charge their own network fees, adding to merchants’ costs.
The complaint describes the combined charges as a significant burden and says merchants now pay more than $100 billion annually in fees to accept Visa and Mastercard credit cards. That figure is an allegation in the lawsuit; the supplied report does not provide an independent accounting or a comparison baseline. The plaintiff asks the court to represent businesses and other entities that accepted either network’s cards from Jan. 25, 2019, until the alleged effects of the conduct end.
How Card Fees Affect Merchants
If the allegations are proven, the case could affect how card networks and issuing banks set fees, and what options merchants have when customers pay by card. Fees are part of the cost of accepting payments for businesses, and the complaint argues that limited ability to reject particular cards or steer customers reduces pressure on providers to compete. Any eventual ruling or settlement could shape merchants’ ability to seek compensation or challenge payment rules.
The dispute also concerns the gap between earlier relief and alleged later losses. The complaint says merchants received no compensation through the prior monetary settlement for transactions after Jan. 24, 2019. That contention does not establish that the defendants violated the law, nor does filing the case guarantee a recovery for the proposed class.
merchant credit card fee calculator
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The Earlier Merchant Settlement
The complaint points to longstanding multidistrict litigation over Visa and Mastercard merchant fees. It says a court approved a monetary class action settlement in December 2019 that provided more than $5 billion in relief for a class period ending Jan. 24, 2019. The new suit focuses on fees paid from the following day onward, a period the plaintiff says was left outside that compensation.
A separate settlement seeking changes to network rules has been preliminarily approved, according to the report. The complaint characterizes that relief as prospective and argues it would not repay merchants for fees paid after Jan. 24, 2019. The existence of that separate settlement is relevant background, but its terms and final status are not detailed in the supplied report.
““a deadweight toll on virtually every credit card purchase in America””
— The lawsuit
Allegations Await Court Review
The supplied report does not state the court, docket number, exact filing date, or whether the defendants have responded. It also does not establish that the proposed class has been certified. The claims about coordination, fee levels, restrictions on merchant choices and the scale of alleged losses remain unproven allegations.
The report does not provide the full terms or final status of the separate settlement seeking rule changes, or say how that proceeding may interact with this lawsuit. The proposed class period is described as continuing until the alleged effects cease, but the complaint’s claims would need to be evaluated by the court.
Court Review and Class Status
The case must proceed through court review. The next developments may include responses from the defendants, motions challenging the claims, and a decision on whether the proposed class can proceed on behalf of merchants. No hearing date, ruling schedule or response from the named companies is included in the supplied report.
For merchants, the central questions will be whether the court allows the claims to move forward and which businesses, if any, qualify for a class. Any payment or changes to card-network rules would depend on later court decisions or an agreement, not simply on the filing of the complaint.
Key Questions
Who filed the lawsuit?
A San Diego pizzeria filed the proposed class action against Visa, Mastercard and Bank of America, Capital One, Chase Bank, Citibank and Wells Fargo.
What does the complaint allege?
It alleges the networks and banks maintained rules and fee schedules that limited competition over merchant credit-card fees and restricted merchants’ ability to steer customers to lower-cost payment options. These claims have not been proven.
Which merchants could be included?
The proposed class covers individuals, businesses and other entities that accepted Visa-branded or Mastercard-branded credit cards in the United States from Jan. 25, 2019, until the alleged effects of the conduct cease. A court has not been reported as certifying the class.
How does this relate to the earlier settlement?
The complaint says a monetary settlement approved in December 2019 covered transactions through Jan. 24, 2019, and did not compensate merchants for later fees. It also refers to a separate settlement seeking prospective rule changes; details and final status are not provided in the report.
Have Visa, Mastercard or the banks responded?
The supplied report does not include responses from the defendants or say whether they have filed formal answers in court.
Source: hn
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