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New York Merchants Sue to Stop Ban on Card-Fee Surcharges

A group of small businesses filed a lawsuit challenging New York’s law prohibiting merchants from imposing surcharges to make up for the fees they must remit when customers pay with a credit card.

Five merchants including a hair salon, ice-cream parlor and liquor store filed a complaint today in federal court in Manhattan demanding that the law be declared unconstitutional. While prohibiting extra charges, the state allows merchants to offer customers discounts for paying with cash, infringing on freedom of speech and preventing consumers from understanding the costs of swipe fees, according to the complaint.