Today, the Retail Industry Leaders Association (RILA) applauded a decision by the U.S. Supreme Court that rejected an attempt by the country’s largest financial institutions and credit card companies to reinstate a class action settlement that had been overturned by the Second Circuit. RILA, along with other merchant trade associations, filed a brief earlier this year opposing the effort to reinstate the unfair settlement terms of MDL1720 – the lawsuit challenging the anticompetitive behavior of the major financial services industry players in setting credit card fees.
“The MDL1720 settlement crafted by the banks and the credit cards was badly flawed, and the Second Circuit recognized as much in its decision. We are pleased that the Supreme Court decided to leave the lower court’s ruling in place,” said Deborah White, RILA senior executive vice president and general counsel. “Merchants and consumers continue to suffer from the anti-competitive practices of banks and card networks. We now have a fresh opportunity to curb these unfair practices.”
The Second Circuit vacated the MDL1720 settlement after finding that the settlement was developed by conflicted counsel and granted the banks and card networks “permanent immunity” from scrutiny of their anticompetitive practices. In their request for an appeal of the lower court’s decision, the proponents of the settlement claimed to speak for the merchant community. In the brief filed earlier this year, RILA and other merchant trade associations explained that the merchant community broadly opposes the settlement and is, in fact, “united in the view that this deal is a bad one, unworthy of resuscitation.”
RILA is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad.