Retail coalition petitions Supreme Court to review U.S. Court of Appeals' swipe fee decision

WASHINGTON — A coalition of retail groups on Monday filed a joint-merchant petition with the Supreme Court seeking its review of the March 2014 swipe fee decision by the U.S. Court of Appeals for the D.C. Circuit.

 

“Congress originally passed a law that was designed to lower swipe fees paid by customers and merchants, but the final Federal Reserve rule disregarded the legislative language and actually raised rates on many transactions," said Leslie Sarasin, president and CEO of the Food Marketing Institute , one of the retail associations to join the petition. "Our food retailers and wholesalers consistently serve their customers based on a simple merchandising strategy — low markups and high volume — and these excessive swipe fees exceed the industry’s 1% net profit on shoppers’ orders," she said. “We urge the Supreme Court to agree to hear this case recognizing that the Fed’s rule has a significant impact on anyone who uses or accepts a debit card, including shoppers, merchants of all sizes and any other non-merchant entity responsible for the 50 billion debit card transactions each year.”

 

The final outcome of the swipe fee rule will have a significant economic impact to the roughly eight million merchant locations that accept debit cards for payment in the United States, the association stated.

 

Earlier this year, the D.C. Circuit largely upheld the Federal Reserve’s debit card rule and network non-exclusivity rule, reversing the decision of the U.S. District Court. FMI and the other plaintiff-petitioner merchant groups argue that the final rule is inconsistent with the clear direction provided by Congress and allows banks to charge American merchants and consumers twice as much as the proposed rule.

 

In the petition — filed in conjunction with FMI, NACS, National Retail Federation, Miller Oil, Boscov’s Department Store, and the National Restaurant Association — the merchant groups assert that this case is significant to the U.S. economy, merchants and consumers and was seen by two different judicial bodies in such contrasting ways that it deserves the review of the Supreme Court.