The Wall Street Journal reports that the United States Government is looking for a piece of the action in the $3 billion settlement being paid by MasterCard and Visa in a case involving debit card fees.
“The antitrust division of the Justice Department submitted a claim late Friday that is estimated to be valued at $100 million, surpassing the $80 million that Wal-Mart Stores Inc., the lead plaintiff in the lawsuit, is estimated to collect from the 2003 settlement.
“By filing a claim, the government is essentially contending that it -- like the nation's retailers -- suffered as a result of Visa and MasterCard's rules. That policy required merchants to accept Visa and MasterCard branded debit cards if they also accepted credit cards branded with their logos. The government racks up millions of debit card transactions each year as consumers use plastic to buy everything from stamps to souvenirs at the Smithsonian Institution's museums and cigarettes on military bases.”
The retailers may not be sanguine about the government’s claim, however. The WSJ reports that to Lloyd Constantine, the lawyer who represented the retailers in the lawsuit that resulted in the settlement, has petitioned the court, saying that there was “a serious question” about whether the government should be allowed to get its hands on any of the money.
“The antitrust division of the Justice Department submitted a claim late Friday that is estimated to be valued at $100 million, surpassing the $80 million that Wal-Mart Stores Inc., the lead plaintiff in the lawsuit, is estimated to collect from the 2003 settlement.
“By filing a claim, the government is essentially contending that it -- like the nation's retailers -- suffered as a result of Visa and MasterCard's rules. That policy required merchants to accept Visa and MasterCard branded debit cards if they also accepted credit cards branded with their logos. The government racks up millions of debit card transactions each year as consumers use plastic to buy everything from stamps to souvenirs at the Smithsonian Institution's museums and cigarettes on military bases.”
The retailers may not be sanguine about the government’s claim, however. The WSJ reports that to Lloyd Constantine, the lawyer who represented the retailers in the lawsuit that resulted in the settlement, has petitioned the court, saying that there was “a serious question” about whether the government should be allowed to get its hands on any of the money.
- KC's View:
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We imagine that the retailers might have some strong opinions about the federal government swooping in at the last minute to try and siphon off some of the settlement money. After all, the government wasn't a party to the case, so it seems a little disingenuous to try and get the biggest piece of the pie.
On the other hand, we’d personally be willing to let the government have the money – as long as we knew what it planned to do with it. A little deficit reduction would be nice, for example. Or maybe they could put it toward cleaning up after Hurricane Katrina. Or perhaps toward creating more and better hospital and rehab facilities for wounded soldiers coming back from Iraq.
But if they’re planning on using the money, say, to finance a renovation of the Senate gym…well, we’d object to that.
Just tell the taxpayers what the money is for. Specifically.
