A federal appeals court on Thursday rejected the US government’s request that it reconsider its decision allowing American Express to stop merchants from encouraging customers to use rival cards that charge lower fees.
Without comment, the 2nd US Circuit Court of Appeals let stand its Sept. 26 reversal of a lower court ruling that had struck down AmEx’s “anti-steering” rules.
That reversal by a three-judge panel allowed New York-based AmEx to block merchants that accept its cards from steering customers to rivals Visa and MasterCard, even if the move saved them money.
At issue were the more than $50 billion of fees that merchants pay annually to process transactions, and which can be passed along to customers through higher prices.
The Justice Department said the appeals court wrongly focused on how the company’s policy affected customers and merchants, rather than merchants alone.
It also said it should have been AmEx’s burden to show that its policy promoted competition, not the government’s burden to show otherwise.
Full Content: Reuters