NEW YORK – Federal Judge John Gleeson ordered merchants favoring the proposed antitrust settlement in the Visa and MasterCard suit to tell him by Thursday why he should not stay a final ruling in the case while objectors to the landmark deal appeal portions of his preliminary ruling.
This morning’s judge’s order comes as several plaintiffs in the suit have asked the U.S. Court of Appeals for the Second Circuit to review the preliminary ruling approving the controversial settlement and barring objectors from opting out of the deal. Judge Gleeson issued a preliminary order yesterday approving his preliminary ruling of November 10, but final approval is still pending.
The objecting plaintiffs include the National Association of Convenience Stores, the National Restaurant Association, Home Depot, D'Agostino Supermarkets Inc., and several others.
A so-called interlocutory appeal of the settlement’s provisions would compel the judge to stay the issuance of a final ruling enacting terms of the deal, unless the other plaintiffs in the case can persuade him otherwise.
Under the settlement, Visa and MasterCard and a handful of big banks would pay out $7.2 billion to eight million merchants and the card networks would reduce fees of credit card transactions by a total of $1.2 billion over eight months. The settlement would also change several Visa and MasterCard bylaws in order to allow merchants to discourage card usage by surcharging non-cash transactions.
A stay in the case could delay payments to merchants and enactment of bylaw changes for months.
The merchant objectors say the settlement does not change the practices of the two card networks enough to satisfy the 2005 civil antitrust suit and that the proposed damages are not enough.