Retailers Want Amex Anti-Steering Case Reheard

American Express is facing a push by the Retail Litigation Center (RLC) and the National Retail Federation (NRF) to have the full 2nd U.S. Circuit Court of Appeals take up a lawsuit over rules that prevent retailers from encouraging customers to use credit cards that don’t have as high of processing fees.

In a press release, the Retail Litigation Center and the National Retail Foundation said the practice violates antitrust rules and makes it hard for merchants to get lower fees from the major credit card companies in the U.S.

“While intense competition is a hallmark of the retail industry, it is largely absent from the credit card market, where fees continue to skyrocket,” said RLC President Deborah White in the press release. “American Express stifles competition by imposing rules that deny merchants the ability to incentivize customers to use lower cost cards and, by doing so, increases costs for all customers. Consumers should have visibility into the cost of transactions and the opportunity to take action to limit them if they so choose.”

Meanwhile, Mallory Duncan, NRF senior vice president and general counsel, said high swipe fees for processing credit card transactions increase the price consumers pay for merchandise. “All swipe fees are too high, but American Express fees are among the highest. That’s their choice, but they should not be allowed to stand in the way of retailers simply asking their customers if they have another card. It’s ultimately American consumers who lose when credit card companies refuse to compete like any other business,” said Duncan.

According to the two groups, while swipe fees average around 2 percent, American Express has had higher fees traditionally. Mastercard and Visa are in the middle, while Discover has the lowest fees, noted the groups. Debit card fees are lower than all of the credit card companies because of the federal law that limits it to a flat fee of around a quarter for the typical transaction.