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December 29th, 2014 at 11:55 am

Google sues Visa and MasterCard

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With little ceremony and only two days before Christmas, Google filed an antitrust law against Visa and MasterCard for setting “supracompetitive” interchange rates from 2004 to 2012. This is but one more volley in the Battle Royale between big companies like Wal-Mart, Target, and Macy’s and major players in the payments industry.

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The unusually sparse, three-page suit, filed in U.S. District Court for the Eastern District of Texas, asks for “actual damages” but does not set out an estimated figure. In the document, Google says it operated as a merchant during the specified years and as a result paid interchange fees for credit and debit cards branded by both networks. Visa and MasterCard could not be immediately reached for comment.

Google thus joins a number of other major companies, including Wal-Mart Stores Inc., that have brought their own suits after opting out of the settlement of a massive, $5.7 billion federal antitrust case known as MDL 1720, in which thousands of merchants challenged interchange and other matters. In total, more than 35 of these “opt-out cases” have been filed against Visa in various courts since May 2013, the network says in its latest annual report covering fiscal 2014. In turn, Visa, has sued Wal-Mart, Home Depot, Sears, and others seeking a court declaration that from 2004 to 2012 its practices did not violate federal antitrust rules.

Altogether, some 8,000 merchants representing a quarter of the combined Visa and MasterCard dollar volume opted out of the settlement, which was reached in the summer of 2012 and finally approved a year ago. That case, heard in U.S. District Court in Brooklyn, N.Y., brought together into one class action a series of merchant suits against the card networks dating back to 2005.

In addition to its role as a merchant, Google has figured prominently in electronic payments in various roles in recent years. In 2011, for example, the Mountain View, Calif.-based online search giant introduced Google Wallet, an Android-based mobile-payments product. In 2006, it launched Google Checkout, an online payments-processing service that has since been discontinued.

Via Digital Transactions

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