Websites critical of a settlement that Visa Inc. and MasterCard Inc. reached with retailers over so-called swipe fees are misleading and must be corrected, a federal judge said.
The sites contain "bad information" that may have caused some retailers to drop out of the settlement, U.S. District Judge John Gleeson said today in Brooklyn, N.Y. He gave the parties a week to decide on changes.
"I'm not going to belabor this with you," Gleeson told Jeffrey Shinder, a lawyer representing retail trade associations that created the sites and have opposed the settlement. "I'm just talking about basic fairness."
Sites at issue include Merchantsobject.com and home sites for the trade groups National Community Pharmacists Association, National Grocers Association and the National Association of Convenience Stores, among others, according to a declaration submitted by the plaintiffs' lawyers.
The sites provide one-sided information encouraging retailers to object and opt out and don't fully explain consequences of those actions, the plaintiffs' lawyers said. Opting out deprives merchants of the ability to receive payments for damages under the deal, the lawyers said.
The Merchantsobject site also fails to give prominent placement to a link to the official, court-approved source of information about the deal, paymentcardsettlement.com, the lawyers said.
Today's hearing came after the Retail Industry Leaders Association announced it would opt out and object to the deal, which may be worth as much as $7.25 billion. The accord, estimated to be the largest-ever antitrust settlement, would end a case over claims that the card companies conspired with banks to fix the fees charged to merchants when customers pay with plastic.
Several retail groups have opposed the settlement since it was made public in July, alleging that it doesn't provide enough benefit for merchants and gives card companies too much leeway to raise rates. Retailers including Target Corp., Wal-Mart Stores Inc., Home Depot Inc. have spoken out against the accord.
Gleeson granted preliminary approval to the deal in November. A hearing on final approval is scheduled for September.
The case is In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, 05-md-01720, U.S. District Court,