Visa hit with merchant class action after US Justice Dept antitrust lawsuit
By Mike Scarcella
Oct 2 (Reuters) -Visa V.N is facing a new lawsuit from U.S. merchants over its payments network, adding legal pressure on the payment card giant after the U.S. Justice Department filed a major antitrust lawsuit against it last week.
Advertising and marketing company All Wrapped Up Signs and Graphix filed the proposed class action on Tuesday in federal court in Manhattan, marking the first private antitrust case piggybacking on the sweeping claims lodged by the Biden administration.
The merchants' lawsuit, like the Justice Department’s case, accused San Francisco-based Visa of paying would-be rivals not to develop competing networks, and threatening merchants with higher fees if they try to use other platforms to process transactions.
“While merchants suffer, Visa profits,” the new lawsuit said.
Visa did not immediately respond to a request for comment. The company has denied the Justice Department’s claims and vowed to fight the government's case.
Dan McCuaig, an attorney for All Wrapped Up at Cohen Milstein Sellers & Toll, in a statement said "we look forward to vigorously representing a class of businesses harmed by Visa's anticompetitive practices."
A wave of private litigation often follows major government cases involving large companies, exposing them to potentially higher damages.
Florida-based All Wrapped Up said Visa's allegedly uncompetitive business practices allowed it to unfairly dominate the debit card market. The company said it seeks to represent a class of potentially hundreds of thousands of small and large businesses.
The lawsuit said Visa charges more than $7 billion in fees annually to merchants to process debit transactions.
The plaintiff’s law firm, Cohen Milstein, long has represented gasoline retailers in Brooklyn federal court accusing Visa and Mastercard of imposing artificially high credit card interchange, or “swipe,” fees to merchants.
The case is All Wrapped Up Signs and Graphix v. Visa, U.S. District Court, Southern District of New York, No. 1:24-cv-07435.
For plaintiff: Brent Johnson of Cohen Milstein
For defendant: No appearance yet
Read more:
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US accuses Visa of monopolizing debit card swipes
Visa, Mastercard can likely handle settlement much bigger than $30 billion, judge says
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Reporting by Mike Scarcella
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