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American Express announced that it has agreed to settle two putative antitrust class action lawsuits filed by U.S. merchants that challenged the company’s card acceptance agreements.
The class action settlement agreement will allow merchants to charge customers less if they use a competing debit card instead of an American Express credit card.
The first class action settlement pertains to In re American Express Anti-Steering Rules Antitrust Litigation, which challenges the Non-Discrimination Provisions in the company’s merchant contracts. The consolidated litigation dates back to 2006 and is pending in the U.S. District Court for the Eastern District Court for the Eastern District of New York.
The American Express second class action settlement was reached in the consolidated case In re Marcus Corporation, the Milwaukee-based operator of hotels and movie theaters, which challenges American Express’ Honor All Cards Provisions. This class action lawsuit dates back to 2004 and is pending in the U.S. District Court for the Southern District of New York.
The American Express class action settlement agreement calls for merchants to continue to agree that if they decide to surcharge their customers using credit or charge cards, any surcharge of American Express Card transactions would be no more than the surcharge on credit or charge card products issued on competing networks.
Similarly, merchants agree that if they surcharge customers paying with prepaid or debit cards, they would not surcharge American Express prepaid cards more than any competing prepaid or debit cards issued on competing networks.
Under the proposed class action settlement, American Express will pay reasonable attorneys fees for both cases up to a maximum total of $75 million, as approved by Court. The company will also reimburse the class plaintiffs’ costs of notifying merchants of the settlement up to $2 million and will provide an additional $2 million fund for plaintiffs to communicate to merchants about the terms of the settlement.
The American Express class action settlement must receive both preliminary and final court approval. Details on how to file a claim for the class action settlement were not immediately available. Keep checking www.TopClassActions.com for updates.
The cases are American Express Anti-Steering Rules Antitrust Litigation, 1:11-md-2221, U.S. District Court, Eastern District of New York (Brooklyn) and Marcus Corp. (MCS) v. American Express Co., 1:04-cv-5432, U.S. District Court, Southern District of New York (Manhattan).
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