Economy 📍

This court case came down on last Monday from the US Supreme Court, yet got very little coverage in the news media.

"A federal appeals court on Monday cleared the way for American Express Co to block merchants that accept its cards from steering customers toward lower-cost cards from other issuers. "

""The 2nd U.S. Circuit Court of Appeals in New York said a lower court judge in Brooklyn erred in February 2015 in finding that American Express’ “anti-steering” rules violated federal antitrust law."

"Underlying the case were the fees that merchants pay to process transactions, which the U.S. government estimated at more than $50 billion a year, and which can be passed along to cardholders in the form of higher prices."

"The lower court judge, Nicholas Garaufis, had found that non-discrimination provisions (NDPs) in American Express’ merchant agreements, meant to dissuade customers from using cards from Visa and MasterCard, unreasonably restrained competition."

"But the appeals court said Garaufis erred by focusing entirely on the interests of merchants rather than cardholders who might benefit from American Express rewards programs and perceived prestige. "