Wal-Mart, Visa Negotiating to End $5 Billion Swipe-Fee Suitby
Retailer sued Visa after dropping out of nationwide accord
Dozens of retailers still pursuing separate swipe-fee suits
The negotiations were disclosed in a court filing Monday in Brooklyn federal court where dozens of retailers are pursuing claims against credit card companies alleging they illegally fixed so-called swipe fees.
Wal-Mart, the world’s largest retailer, and other merchants dropped out of a nationwide settlement with Visa and MasterCard Inc. over the fees after retail trade groups argued that the compensation was too low and the terms too generous in allowing the card companies to raise rates in the future.
Amazon.com Inc., the world’s largest online retailer, also dropped out of the deal and is pursuing claims in a separate lawsuit with a group of other retailers. Approval of the settlement, initially valued at $7.25 billion then lowered to $5.7 billion to account for the dropouts, is on appeal.
Swipe fees are deducted from purchases when customers pay with credit cards. The fees, which are generally invisible to consumers, have long been a source of complaints from retailers who must bear the cost.
The U.S. government estimates that payment card companies collect as much as $50 billion in swipe fees a year from U.S. merchants, according to court documents in a separate credit card case.
Wal-Mart claimed Visa’s conduct caused it to suffer “enormous damage” from January 2004 to November 2012. In the filing Monday, lawyers for both sides asked to delay information-sharing in the dispute to “continue to engage in discussions” on settling dueling lawsuits.
Randy Hargrove, a spokesman for Wal-Mart, confirmed that the companies are "attempting to resolve their litigation" and have asked the court to halt further proceedings.
Connie Kim, a spokeswoman for Visa, declined to comment.
The case is In Re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation -- Opt Out Cases, 14-md-1720, U.S. District Court, Eastern District of New York (Brooklyn).