Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-02676/USCOURTS-cand-3_04-cv-02676-33/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:1 Antitrust Litigation

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

IN RE ATM FEE ANTITRUST

LITIGATION,

 /

No. C 04-2676 CRB

ORDER

On May 14, 2010, the Court will hear argument on Defendants’ Motions to Dismiss. 

In addition to the issues raised in those motions, the parties should be prepared to discuss the

following questions:

1. Assume that Bank A is a member of the Star Network and Bank B is not. If one of

Bank B’s customers uses his ATM card at one of Bank A’s ATMs, can that

transaction be routed over the Star Network? In other words, do both banks have to

be members of the Star Network in order for a transaction to be routed over that

network?

2. Are banks typically members of more than one ATM Network?

3. If the answer to question two is YES, assume that Bank A and Bank B are both

members of the Star Network and a second ATM network, such as the Plus ATM

Network. If a Bank A customer uses her ATM card at a Bank B ATM, what factors

determine which of the two networks the transaction will be routed over? For

example, does Bank B get to choose? Do certain networks get priority by agreement? 

4. Plaintiffs allege that there are twenty-five competitors in the ATM Networks market

and that all twenty-five require member banks to pay an Interchange Fee. TAC ¶ ¶

69, 88. Are the Interchange Fees established by some of these competitors lower than

the fee that Star has adopted?

5. Do the parties agree with the following: Interchange fees are paid by one bank to

another. Among the banks, interchange fees are therefore a zero sum game: every

dollar spent in Interchange Fees by one bank is a dollar received by a second bank. 

As a result, in order for one bank to receive a net benefit from Interchange Fees, at

least one other bank must incur a net loss.

Case 3:04-cv-02676-CRB Document 652 Filed 05/12/10 Page 1 of 2
United States District Court

For the Northern District of California

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G:\CRBALL\2004\2676\Questions re MTDs TAC.wpd 2

6. If the parties agree with the analysis set forth in question five and the answer to

question four is YES (i.e., some networks charge lower Interchange Fees), why would

banks that incur a “net loss” from Interchange Fees choose the Star Network rather

than one of its lower-priced competitors? In other words, why wouldn’t a bank that is

net loser minimize its losses by choosing a lower-priced competitor?

IT IS SO ORDERED.

Dated: May 12, 2010 

 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

Case 3:04-cv-02676-CRB Document 652 Filed 05/12/10 Page 2 of 2