Twins enter credit card swipe fee dispute after opting out of class-action deal
- Article by: Jennifer Bjorhus
- Star Tribune
- February 11, 2014 - 8:47 PM
It’s the sixth or seventh inning in the battle merchants are waging against Visa and MasterCard over high transaction fees, and the Minnesota Twins are now at the plate.
The team is among the latest businesses to sue the two dominant credit card networks, accusing them of breaking antitrust laws by fixing bloated fees that retailers have to pay to accept their customers’ credit cards.
The so-called interchange fees, or swipe fees, amount to about 2 percent of a purchase and were the focus of a long-running class action antitrust fight between retailers and the card networks and card-issuing banks. That lawsuit settled in 2012 for a record $7.25 billion, with a federal judge ultimately approving $5.7 billion after thousands of dissatisfied retailers opted out of the damages portion of the deal.
The Twins are part of a local group of opt-outs that includes Granite City Food & Brewery and JB Hudson Jewelers; they filed their own lawsuit Feb. 7 in U.S. District Court in Brooklyn. The complaint doesn’t say how much the companies think they are owed.
Twins spokesman Kevin Smith characterized the lawsuit as something of a technicality “to protect our interests.”
“Once we opted out, the legal system pushed the burden on us to move forward with obtaining a fair result,” Smith said. “We’ll see what happens.”
Vincent Esades, the Minneapolis antitrust lawyer representing the group, said the companies are basically making the same case against Visa Inc. and MasterCard Inc. as the original antitrust class lawsuit.
Esades estimated that “hundreds” of such cases have been filed in the wake of the settlement, but said he feels confident the group will get more in damages on their own than they would as part of the settlement.
K. Craig Wildfang, the Minneapolis antitrust lawyer who quarterbacked the historic interchange settlement for retailers, said the record on what opt-outs have been awarded in damages on their own, after opting out of class-action antitrust settlements, is mixed.
“They should plan on litigating their claims over the next several years,” Wildfang said.
Jennifer Bjorhus • 612-673-4683
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