The National Restaurant Association said it will reject a proposed settlement of as much as $7.25 billion with Visa Inc. (V) and MasterCard Inc. (MA) over the fees they charge stores when customers pay with credit cards.
The settlement won’t change a broken system on how the so- called swipe fees are set, the association said in a statement today.
“Without meaningful reform, there is concern that restaurateurs -- many of whom are small businesses -- will continue to be negatively impacted by the unfair, non- transparent system that exists today,” Dawn Sweeney, the Washington-based industry group’s president, said in the statement.
The settlement announced July 13 still needs approval by a federal judge. It would put to rest about seven years of litigation over claims that San Francisco-based Visa and Purchase, New York-based MasterCard conspired to fix fees. The accord calls for a temporary reduction in rates for merchants and would allow them to impose surcharges on customer purchases.
The restaurant association joins the National Retail Federation, which represents more than 9,000 retailers, in opposing the settlement. The retailer association said on Sept. 11 that the proposed agreement does nothing to prevent Visa and MasterCard from raising swipe fees in the future.
The case is In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, 05-md-01720, U.S. District Court, Eastern District of New York (Brooklyn).
To contact the reporter on this story: Tiffany Kary in New York bankruptcy court at firstname.lastname@example.org
To contact the editor responsible for this story: Michael Hytha at email@example.com