62858 Federal Register / Vol. 75, No. 197 / Wednesday, October 13, 2010 / Notices 

Assistant Attorney General, 

Environment and Natural Resources 

Division, and either e-mailed to 

pubcomment-ees.enrd@usdoj.gov or 

mailed to P.O. Box 7611, U.S. 

Department of Justice, Washington, DC 

20044–7611, and should refer to In re 

Chemtura Corp., et al., D.J. Ref. 90–11– 

3–09736. Commenters may request an 

opportunity for a public meeting in the 

affected area, in accordance with 

Section 7003(d) of the Resource 

Conservation and Recovery Act, 42 

U.S.C. 6973(d). 

The Settlement Agreement may be 

examined at the Office of the United 

States Attorney, 86 Chambers Street, 3rd 

Floor, New York, New York 10007, and 

at the U.S. Environmental Protection 

Agency, Ariel Rios Building, 1200 

Pennsylvania Avenue, NW., 

Washington, DC 20460. During the 

public comment period, the Settlement 

Agreement may also be examined on the 

following Department of Justice Web 

site, http://www.usdoj.gov/enrd/ 

Consent_Decrees.html. Copies of the 

Settlement Agreement may also be 

obtained by mail from the Consent 

Decree Library, P.O. Box 7611, U.S. 

Department of Justice, Washington, DC 

20044–7611 or by faxing or e-mailing a 

request to Tonia Fleetwood 

(tonia.fleetwood@usdoj.gov), fax no. 

(202) 514–0097, phone confirmation 

number (202) 514–1547. In requesting a 

copy from the Consent Decree Library, 

please enclose a check in the amount of 

$5.25 (25 cents per page reproduction 

cost) payable to the U.S. Treasury or, if 

by e-mail or fax, please forward a check 

in that amount to the Consent Decree 

Library at the stated address. 

Maureen Katz, 

Assistant Section Chief, Environmental 

Enforcement Section, Environment and 

Natural Resources Division. 

[FR Doc. 2010–25690 Filed 10–12–10; 8:45 am] 

BILLING CODE 4410–15–P 

DEPARTMENT OF JUSTICE 

Notice of Lodging of Consent Decree 

Under Sections 107(A) and 113(G)(2) of 

The Comprehensive Environmental 

Response, Compensation, and Liability 

Act of 1980 

Notice is hereby given that on October 

5, 2010, a Complaint was filed and a 

proposed Consent Decree was lodged in 

the United States District Court for the 

District of Utah in a matter captioned 

United States v. Mueller Industries, Inc., 

Civil Action No. 2:10–cv–00981–BCW. 

The Complaint is a civil action 

brought jointly by the United States and 

the State against Mueller Industries, Inc. 

(‘‘Mueller’’) under Sections 107(a) and 

113(g)(2) of the CERCLA, 42 U.S.C. 

9607(a) and 9613(g)(2). The Complaint 

seeks the recovery of costs incurred and 

to be incurred by the United States and 

the State in response to releases or 

threatened releases of hazardous 

substances at the Eureka Mills 

Superfund Site (‘‘Site’’) in Eureka, Utah., 

which the United States and the State of 

Utah allege are attributable to the 

activities of Mueller and its 

predecessors. The proposed Consent 

Decree resolves all allegations asserted 

in the Complaint and provides for a 

payment of $ 2,250,000 to the United 

States and $250,000 to the State of Utah. 

In exchange, Mueller receives from the 

United States and the State a covenant 

not to sue for past and future response 

costs for the Site and a covenant not to 

sue for certain property immediately 

adjacent to the Site, but only to the 

extent that releases from the adjacent 

property contribute to response costs 

incurred on-Site. 

The Department of Justice will receive 

for a period of thirty (30) days from the 

date of this publication comments 

relating to the settlement. Comments 

should be addressed to the Assistant 

Attorney General, Environment and 

Natural Resources Division, and either 

e-mailed to pubcommentees.enrd@usdoj.gov or mailed to P.O. 

Box 7611, U.S. Department of Justice, 

Washington, DC 20044–7611, and 

should refer to United States v. Mueller 

Industries, Inc., Civil Action No. 2:10– 

cv–00981–BCW, Ref. 90–11–3–07993/5. 

The Consent Decree may be examined 

at the United States Attorneys Office for 

the District of Utah, 185 South State 

Street, Suite 300, Salt Lake City, Utah 

84111 (USAO No. 2010v00238) and at 

U.S. EPA Region 8, 1595 Wynkoop 

Street, Denver, CO 80202–1129. During 

the public comment period, the Consent 

Decree, may also be examined on the 

following Department of Justice Web 

site, follows http://www.usdoj.gov/enrd/ 

Consent_Decrees.html. A copy of the 

Consent Decree may also be obtained by 

mail from the Consent Decree Library, 

P.O. Box 7611, U.S. Department of 

Justice, Washington, DC 20044–7611 or 

by faxing or e-mailing a request to Tonia 

Fleetwood (tonia.fleetwood@usdoj.gov), 

fax no. (202) 514–0097, phone 

confirmation number (202) 514–1547. In 

requesting a copy, exclusive of exhibits, 

from the Consent Decree Library, please 

enclose a check in the amount of $6.00 

(25 cents per page reproduction cost) 

payable to the U.S. Treasury or, if by 

e-mail or fax, forward a check in that 

amount to the Consent Decree Library at 

the stated address. If requesting a copy 

including all exhibits, please enclose a 

check in the amount of $6.50 payable to 

the U.S. Treasury. 

Maureen Katz, 

Assistant Chief, Environmental Enforcement 

Section, Environment and Natural Resources 

Division. 

[FR Doc. 2010–25670 Filed 10–12–10; 8:45 am] 

BILLING CODE 4410–15–P 

DEPARTMENT OF JUSTICE 

Antitrust Division 

United States, et al. v. American 

Express Company, et al.; Proposed 

Final Judgment and Competitive 

Impact Statement 

Notice is hereby given pursuant to the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. 16(b)–(h), that a proposed 

Final Judgment, Stipulation, and 

Competitive Impact Statement have 

been filed with the United States 

District Court for the Eastern District of 

New York in United States of America, 

et al. v. American Express Company, et 

al., Civil Action No. CV–10–4496. On 

October 4, 2010, the United States and 

seven States filed a Complaint alleging 

that certain rules, policies, and practices 

of Defendants American Express 

Company, American Express Travel 

Related Services Company, Inc., 

MasterCard International Incorporated, 

and Visa Inc. violate Section 1 of the 

Sherman Act, 15 U.S.C. 1. Those rules, 

policies, and practices obstruct 

merchants from offering discounts, 

other benefits, and information to 

customers who use the merchants’ 

preferred form of payment. The 

proposed Final Judgment, filed on the 

same day as the Complaint, resolves the 

case with respect to Defendants 

MasterCard and Visa by prohibiting 

them from maintaining the rules, 

policies, and practices challenged in the 

Complaint. 

Copies of the Complaint, proposed 

Final Judgment, and Competitive Impact 

Statement are available for inspection at 

the Department of Justice, Antitrust 

Division, Antitrust Documents Group, 

450 Fifth Street, NW., Suite 1010, 

Washington, DC 20530 (telephone: 202– 

514–2481), on the Department of 

Justice’s Web site at http:// 

www.usdoj.gov/atr, and at the Office of 

the Clerk of the United States District 

Court for the Eastern District of New 

York. Copies of these materials may be 

obtained from the Antitrust Division 

upon request and payment of the 

copying fee set by Department of Justice 

regulations. 

Public comment is invited within 60 

days of the date of this notice. Such 

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Federal Register / Vol. 75, No. 197 / Wednesday, October 13, 2010 / Notices 62859 

comments, and responses thereto, will 

be filed with the Court and may be 

published in the Federal Register, in 

accordance with the Antitrust 

Procedures and Penalties Act. 

Comments should be directed to John 

Read, Chief, Litigation III, Antitrust 

Division, Department of Justice, 

Washington, DC 20530, (telephone: 

202–307–0468). 

Robert Kramer, 

Director of Operations. 

In The United States District Court for 

the Eastern District of New York 

United States of America, State of 

Connecticut, State of Iowa, State of 

Maryland, State of Michigan, State of 

Missouri, State of Ohio, and State of 

Texas Plaintiffs, v. American Express 

Company, American Express Travel 

Related Services Company, Inc., 

Mastercard International Incorporated, 

and Visa Inc. Defendants. 

Civil Action No. CV–10–4496 

(Garaufis, J.) 

(Pollak, M.J.) 

Complaint for Equitable Relief for 

Violation of Section 1 of the Sherman 

Act, 15 U.S.C. 1 

The United States of America, by its 

attorneys acting under the direction of 

the Attorney General; the State of 

Connecticut, by its Attorney General 

Richard Blumenthal; the State of Iowa, 

by its Attorney General Thomas J. 

Miller; the State of Maryland, by its 

Attorney General Douglas F. Gansler; 

the State of Michigan, by its Attorney 

General Michael A. Cox; the State of 

Missouri, by its Attorney General Chris 

Koster; the State of Ohio, by its Attorney 

General Richard Cordray; and the State 

of Texas, by its Attorney General Greg 

Abbott (collectively, ‘‘Plaintiffs’’), bring 

this civil antitrust action against 

Defendants American Express Company 

and American Express Travel Related 

Services Company, Inc. (collectively, 

‘‘American Express’’), MasterCard 

International Incorporated 

(‘‘MasterCard’’), and Visa Inc. (‘‘Visa’’) 

(collectively, ‘‘Defendants’’) to obtain 

equitable relief to prevent and remedy 

violations of Section 1 of the Sherman 

Act, 15 U.S.C. 1. 

Plaintiffs allege: 

I. Introduction 

1. Defendants operate the three largest 

credit and charge card transaction 

networks in the United States. In 2009, 

a substantial amount of interstate 

commerce—over $1.6 trillion in 

transaction volume—flowed through 

Defendants’ networks. Every time a 

consumer uses one of Defendants’ credit 

or charge cards to pay for a purchase 

from a merchant, the merchant must pay 

a fee, often called a ‘‘card acceptance 

fee,’’ ‘‘merchant discount fee,’’ or ‘‘swipe 

fee.’’ In 2009 alone, Defendants and their 

affiliated banks collected more than $35 

billion in such fees from U.S. 

merchants. Defendants’ fees are a 

significant cost for merchants that 

accept Defendants’ cards, and 

merchants pass these costs on to all 

consumers through higher retail prices. 

2. Plaintiffs bring this action to 

prevent Defendants from imposing on 

merchants certain rules, policies, and 

practices (‘‘Merchant Restraints’’) that 

insulate Defendants from competition. 

The Merchant Restraints impede 

merchants from promoting or 

encouraging the use of a competing 

credit or charge card with lower card 

acceptance fees. Each Defendant’s 

vertical Merchant Restraints are directly 

aimed at restraining horizontal 

interbrand competition. 

3. Each Defendant has suppressed 

competition with rival networks at the 

‘‘point of sale,’’ where merchants 

interact directly with customers, by 

disrupting the ordinary give and take of 

the marketplace. Most consumers who 

use credit or charge cards carry more 

than one. Defendants’ Merchant 

Restraints, however, prevent merchants 

from offering their customers a discount 

or benefit for using a network credit 

card that is less costly to the merchant. 

Merchants cannot reward their 

customers based on the customer’s card 

choice. Merchants cannot even suggest 

that their customers use a less costly 

alternative card by posting a sign stating 

‘‘we prefer’’ another card or by 

disclosing a card’s acceptance fee. In 

short, Defendants’ Merchant Restraints 

prohibit merchants from fostering 

competition among credit card networks 

at the point of sale. 

4. By incorporating and enforcing its 

Merchant Restraints in agreements with 

merchants, each Defendant has violated 

and continues to violate Section 1 of the 

Sherman Act, 15 U.S.C. 1. 

II. Defendants 

5. Defendant American Express 

Company is a New York corporation 

with its principal place of business in 

New York, New York. Defendant 

American Express Travel Related 

Services Company, Inc., a wholly 

owned subsidiary of American Express 

Company, is a Delaware corporation, 

with its principal place of business in 

New York, New York. It is the principal 

operating subsidiary of American 

Express Company. In 2009, cardholders 

used American Express credit and 

charge cards for purchases totaling 

$419.8 billion. 

6. Defendant MasterCard is a 

Delaware corporation with its principal 

place of business in Purchase, New 

York. In 2009, cardholders used 

MasterCard credit and charge cards for 

purchases totaling $476.9 billion. 

7. Defendant Visa is a Delaware 

corporation with its principal place of 

business in San Francisco, California. 

Visa has offices, transacts business, and 

is found in New York. In 2009, 

cardholders used Visa credit and charge 

cards for purchases totaling $764.2 

billion. 

III. Jurisdiction and Venue 

8. Plaintiff United States of America 

brings this action pursuant to Section 4 

of the Sherman Act, as amended, 15 

U.S.C. 4, to obtain equitable and other 

relief to prevent and restrain violations 

of Section 1 of the Sherman Act, 15 

U.S.C. 1. Plaintiffs Connecticut, Iowa, 

Maryland, Michigan, Missouri, Ohio, 

and Texas, by and through their 

respective Attorneys General, bring this 

action in their respective sovereign 

capacities and as parens patriae on 

behalf of the citizens, general welfare, 

and economy of their respective States 

under their statutory, equitable and/or 

common law powers, and pursuant to 

Section 16 of the Clayton Act, 15 U.S.C. 

26, to prevent Defendants from violating 

Section 1 of the Sherman Act. 

9. This Court has subject-matter 

jurisdiction over this action under 

Section 4 of the Sherman Act, 15 U.S.C. 

4. 

10. This Court has personal 

jurisdiction over each Defendant and 

venue is proper in this District under 15 

U.S.C. 22 because each Defendant 

transacts business and/or is found 

within this District. Defendants’ credit 

and charge cards are and have been 

used for billions of dollars of purchases 

in this District. 

IV. Trade and Commerce 

11. Defendants operate credit and 

charge card networks in the United 

States, and sell products and services in 

the flow of interstate commerce. 

Defendants’ products and services 

involve a substantial amount of 

interstate commerce. In 2009, credit and 

charge card transaction volume on 

Defendants’ networks in the United 

States exceeded $1.6 trillion. 

V. Industry Background 

12. General purpose credit and charge 

cards (‘‘General Purpose Cards’’) are 

payment devices that a consumer can 

use to make purchases from a wide 

variety of merchants without accessing 

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62860 Federal Register / Vol. 75, No. 197 / Wednesday, October 13, 2010 / Notices 

or reserving the consumer’s funds at the 

time of the purchase. There are two 

principal types of General Purpose 

Cards: 

a. Credit cards, which usually permit 

the cardholder to pay either (i) all 

charges within a set period after a 

monthly bill is rendered, or (ii) only a 

portion of the charges within that time 

and pay the remainder in monthly 

installments, including interest; and 

b. charge cards, which require the 

cardholder to pay all charges within a 

set period after a monthly bill is 

rendered. 

13. General Purpose Cards include 

cards for personal use (issued to 

individuals for their personal use), cards 

for small business (issued to individuals 

for use with a small business), and 

commercial and corporate cards (issued 

to individuals, organizations, and 

businesses for business use). 

14. General Purpose Cards do not 

include cards that can be used at only 

one merchant (such as department store 

cards) or cards that access funds on 

deposit in a checking or savings account 

or on the card itself (such as signature 

debit cards, PIN debit cards, prepaid 

cards, or gift cards). 

15. In Visa and MasterCard 

transactions, the ‘‘card acceptance fee’’ 

or ‘‘merchant discount fee’’ that a 

merchant pays has three principal 

components: the interchange fee, the 

assessment fee, and the acquiring fee. 

To comply with the Visa and 

MasterCard rules, the merchant’s bank 

(called the ‘‘acquiring bank’’), which 

manages the merchant’s relationship 

with Visa and MasterCard, must 

withhold the full card acceptance fee 

from the amount it pays the merchant 

for each transaction, meaning the 

merchant receives less than the retail 

price it charges to the consumer. 

16. The largest component of the card 

acceptance fee is the interchange fee, 

which is received by the Visa or 

MasterCard ‘‘issuing bank’’ (or ‘‘issuer’’) 

that issues the card used by the 

customer. The interchange fee typically 

is set as a percentage of the underlying 

transaction price. Visa and MasterCard 

set interchange fees and have raised 

them significantly over time. 

17. Visa and MasterCard themselves 

keep a part of the fee paid by merchants 

(the ‘‘assessment fee’’). 

18. Finally, the acquiring bank keeps 

one component of the card acceptance 

fee, the acquiring fee, for its services. 

19. American Express issues most of 

its General Purpose Cards to 

cardholders directly, combining issuer 

and network functions with respect to 

those General Purpose Cards. American 

Express generally provides network 

services directly to merchants as well. 

Some American Express cards are 

issued through agreements with issuing 

banks, in which case American Express 

operates only as a network. For all 

purposes relevant to this Complaint, 

such bank-issued cards function 

substantially the same as those issued 

by American Express directly, and 

American Express imposes the same 

Merchant Restraints for acceptance of its 

bank-issued cards. 

20. Like the Visa and MasterCard 

networks, American Express’ network 

imposes a fee on the merchant for each 

transaction. Like Visa and MasterCard, 

American Express’ card acceptance fee 

typically is set as a percentage of the 

transaction price. For example, 

American Express imposes a card 

acceptance fee of 3% for some 

transactions. In such transactions, 

merchants would receive $97 on a $100 

retail transaction. American Express 

would extract the remaining $3 from the 

transaction. The cost borne by 

merchants for customers’ use of 

American Express General Purpose 

Cards is often substantially higher than 

the cost of customers’ use of competing 

networks’ General Purpose Cards. Any 

other General Purpose Card selected by 

the customer from the options in his or 

her wallet—such as a Discover, 

MasterCard, or Visa General Purpose 

Card—generally would be less costly to 

the merchant. 

21. Merchants charge higher retail 

prices to customers to cover the cost of 

paying these fees to Defendants. 

VI. Restraints on Competition 

22. Each Defendant has instituted its 

own set of Merchant Restraints 

prohibiting or restricting a merchant 

that accepts that Defendant’s General 

Purpose Card from encouraging its 

customers to use any other network’s 

card at the point of sale. Defendants’ 

Merchant Restraints impose a 

competitive straightjacket on merchants, 

restricting decisions by them to offer 

discounts, benefits, and choices to 

customers that many merchants would 

otherwise be free to offer. 

23. Each Defendant applies its 

Merchant Restraints through agreements 

with merchants or with merchants’ 

acquiring banks. Each Defendant’s set of 

vertically imposed restrictions 

independently restrains competition 

among networks. Each Defendant’s 

Merchant Restraints violate Section 1 of 

the Sherman Act apart from the 

existence of the other two Defendants’ 

Merchant Restraints. 

24. Visa and MasterCard include their 

Merchant Restraints in contracts with 

acquiring banks. Through these 

contracts, Visa and MasterCard require 

acquiring banks to obtain agreement 

from merchants to abide by Visa’s and 

MasterCard’s rules, including the 

Merchant Restraints. Visa and 

MasterCard require their acquiring 

banks to penalize merchants that do not 

adhere to the Merchant Restraints. 

American Express includes its Merchant 

Restraints in its contracts with 

merchants that accept its cards. In 

circumstances where American Express 

contracts with the merchant’s acquiring 

bank, American Express requires the 

acquiring bank to ensure the merchant 

complies with the Merchant Restraints. 

25. Merchants must accept the 

Merchant Restraints in order to accept 

Defendants’ cards. Merchants clearly 

understand and expressly agree that 

they must comply with the Merchant 

Restraints. Defendants actively monitor 

and vigorously enforce the Merchant 

Restraints. 

26. Visa’s Merchant Restraints 

prohibit a merchant from offering a 

discount at the point of sale to a 

consumer who chooses to use an 

American Express, Discover, or 

MasterCard General Purpose Card 

instead of a Visa General Purpose Card. 

Visa’s rules do not allow discounts for 

other payment cards that generally 

require a signature at the point of sale, 

unless such discounts are equally 

available for Visa transactions. Visa 

International Operating Regulations at 

445 (April 1, 2010) (Discount Offer— 

U.S. Region 5.2.D.2). 

27. Similarly, MasterCard’s Merchant 

Restraints prohibit a merchant from 

‘‘engag[ing] in any acceptance practice 

that discriminates against or discourages 

the use of a [MasterCard] Card in favor 

of any other acceptance brand.’’ 

MasterCard Rule 5.11.1 (May 12, 2010). 

This means that merchants cannot offer 

a discount, or any other benefit, to 

persuade consumers to use an American 

Express, Discover, or Visa General 

Purpose Card instead of a MasterCard 

General Purpose Card. Id. MasterCard 

does not allow merchants to favor 

competing card brands. Id. 

28. American Express’ point-of-sale 

rules on merchants restrict competition 

more than the rules of its rival networks. 

American Express’ Merchant Restraints 

are described in its ‘‘Merchant Reference 

Guide–US’’ (April 2010), Section 3.2. 

The language in Section 3.2 is inserted 

in identical or substantially similar form 

in most of American Express’ contracts 

with merchants. In many agreements, 

the Guide is expressly incorporated by 

reference. The Merchant Restraints 

described in Section 3.2 impose the 

following restrictions on merchants that 

accept American Express: 

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Merchants must not: 

—indicate or imply that they prefer, 

directly or indirectly, any Other 

Payment Products over [American 

Express’] Card, 

—try to dissuade Cardmembers from 

using the Card, 

—criticize * * * the Card or any of 

[American Express’] services or 

programs, 

—try to persuade or prompt 

Cardmembers to use any Other 

Payment Products or any other 

method of payment (e.g., payment by 

check), 

—impose any restrictions, conditions, 

[or] disadvantages * * * when the 

Card is accepted that are not imposed 

equally on all Other Payment 

Products, except for ACH funds 

transfer, cash, and checks, * * * or 

—promote any Other Payment Products 

(except the Merchant’s own private 

label card that they issue for use 

solely at their Establishments) more 

actively than the Merchant promotes 

[American Express’] Card. 

Merchants may offer discounts from 

their regular prices for payments in cash 

or by ACH funds transfer or check, 

provided that they clearly disclose the 

terms of the offer (including the regular 

and discounted prices) to customers and 

that any discount offered applies 

equally to Cardmembers and holders of 

Other Payment Products. 

Whenever payment methods are 

communicated to customers, or when 

customers ask what payments are 

accepted, the Merchant must indicate 

their acceptance of the Card and display 

[American Express’] Marks according to 

[American Express’] guidelines and as 

prominently and in the same manner as 

any Other Payment Products. 

29. The American Express Merchant 

Reference Guide–US defines the term 

‘‘Other Payment Products’’ used in 

Section 3.2 as ‘‘[a]ny charge, credit, 

debit, stored value or smart cards, 

account access devices, or other 

payment cards, services, or products 

other than the [American Express] 

Card.’’ 

30. Defendants’ rules and practices 

described in paragraphs 26–29 

constitute the Merchant Restraints 

challenged in this action because and to 

the extent that they deter or obstruct 

merchants from freely promoting 

interbrand competition by offering 

customers discounts, other benefits, or 

information to encourage the customer 

to use a General Purpose Card or 

payment method other than that 

Defendant’s General Purpose Card. 

31. Defendants’ Merchant Restraints 

thus forbid, among other things, the 

following types of actions a merchant 

could otherwise use at the point of sale 

to foster competition on price and terms 

among sellers of network services: 

—promoting a less expensive General 

Purpose Card brand more actively 

than any other General Purpose Card 

brand; 

—offering customers a discount or 

benefit for use of a General Purpose 

Card brand that costs less to the 

merchant; 

—asking customers at the point of sale 

if they would consider using another 

General Purpose Card brand in their 

wallets; 

—posting a sign encouraging use of, or 

expressing preference for, a General 

Purpose Card brand that is less 

expensive for the merchant; 

—posting the signs or logos of General 

Purpose Card brands that cost less to 

the merchant more prominently than 

signs or logos of more costly General 

Purpose Card brands; or 

—posting truthful information 

comparing the relative costs of 

different General Purpose Card 

brands. 

32. Federal law mandates that 

networks permit merchants to offer 

discounts for cash transactions. 

Additionally, the new Dodd-Frank Wall 

Street Reform and Consumer Protection 

Act of 2010, by adding section 920 to 

the Electronic Fund Transfer Act, 15 

U.S.C. 1693 et seq., now forbids 

networks from prohibiting merchants 

from offering a discount for an entire 

payment method category, such as a 

discount for use of any debit card. All 

General Purpose Card networks operate 

under these laws. This Complaint does 

not seek relief relating to these two 

types of discounting. 

VII. Relevant Markets 

A. Product Markets 

33. Defendants participate in two 

distinct product markets in the United 

States relevant to this Complaint: the 

General Purpose Card network services 

market, and the General Purpose Card 

network services market for merchants 

in travel and entertainment (‘‘T&E’’) 

businesses. 

1. General Purpose Card Network 

Services 

34. General Purpose Card network 

services involve the processing of 

General Purpose Card transactions 

across a network. General Purpose Card 

networks provide infrastructure and 

mechanisms enabling merchants to 

obtain authorization for, settle, and clear 

transactions for their customers who 

pay with General Purpose Cards. 

Merchant acceptance of General 

Purpose Cards is defined and controlled 

at the network level, and prices to 

merchants are established directly or 

indirectly by the networks. A relevant 

product market for this case is the 

provision of General Purpose Card 

network services to merchants. 

35. American Express, Discover, 

MasterCard, and Visa compete as sellers 

of these network services to merchants 

in the United States. 

36. Visa and MasterCard provide 

network services indirectly to 

merchants through the merchants’ 

acquiring banks. American Express 

generally sells its network services 

directly to merchants. 

37. Merchants accept General Purpose 

Cards because many consumers strongly 

prefer to use General Purpose Cards 

over other means of payment. Millions 

of consumers prefer General Purpose 

Cards because they provide a 

combination of convenience, 

widespread acceptance, security, and 

deferred payment options that are not 

effectively replicated by other payment 

methods. 

38. Each Defendant provides network 

services only for the use of its own 

General Purpose Cards, not for any other 

network’s General Purpose Cards. 

Merchants that accept General Purpose 

Cards must purchase network services. 

Merchants cannot reasonably replace 

General Purpose Card network services 

with other services or reduce usage of 

these network services, even if such 

network services are substantially more 

expensive for merchants relative to 

services that enable other payment 

methods. Even a large increase in 

network fees would not provide a 

meaningful financial incentive for 

merchants to abandon acceptance of 

General Purpose Cards. Although other 

services that enable payment exist 

outside this relevant market, none of 

these services is a reasonable substitute 

for General Purpose Card network 

services from the perspective of 

merchants. 

39. Competition from other payment 

methods in the geographic market 

identified below would not be sufficient 

to prevent a hypothetical monopolist of 

General Purpose Card network services 

from profitably maintaining 

supracompetitive prices and terms for 

network services provided to merchants 

over a sustained period of time. Nor 

would competition from other payment 

methods prevent a hypothetical 

monopolist in the General Purpose Card 

network services market from imposing 

anticompetitive conditions on 

merchants in that market. 

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40. In addition to selling General 

Purpose Card network services to 

merchants, Defendants provide separate 

network services to a different group of 

customers: issuers, which provide 

General Purpose Cards to cardholders. 

Questions of market power and harm 

are distinct for the two separate 

customer groups. Sellers of General 

Purpose Card network services to 

merchants could exercise market power 

over merchants even in circumstances 

in which they could not exercise market 

power over issuers. Any benefits 

received by issuers are not necessarily 

shared with merchants, and would not 

offset anticompetitive harm imposed by 

networks on merchants. 

2. Travel and Entertainment Market 

41. Within the relevant market of 

General Purpose Card network services, 

there is another relevant market—a 

price discrimination market—consisting 

of General Purpose Card network 

services provided to merchants in travel 

and entertainment businesses. 

Specifically, merchants selling goods 

and services to customers primarily for 

travel and entertainment (for example, 

air travel, lodging, and rental cars) are 

exposed to price discrimination. 

42. Price discrimination occurs when 

a seller charges different customers (or 

groups of customers) different prices for 

the same services, when those different 

prices are not based on different costs of 

serving those customers. General 

Purpose Card networks set fees for 

network services to some merchants 

separately from fees to other merchants. 

Setting a lower fee for one group has 

little to no effect on a network’s ability 

to set a higher fee for other groups. 

43. Competition from other payment 

methods in the geographic market 

identified below would not be sufficient 

to prevent a hypothetical monopolist in 

the market for General Purpose Card 

network services for T&E merchants 

from either profitably maintaining 

supracompetitive prices and terms for 

network services to T&E merchants over 

a sustained period of time or imposing 

anticompetitive conditions on T&E 

merchants in that market. A 

hypothetical monopolist could price 

discriminate profitably against T&E 

merchants even if other merchants were 

paying lower prices for network 

services. 

44. Each Defendant can identify 

whether a merchant participates in the 

T&E sector, and establishes merchant 

pricing by segment or category. Each 

Defendant, for example, has one set of 

prices for airline merchants and a 

different set of prices for supermarket 

merchants. American Express has 

separate price schedules for Airlines, 

Lodging, Car Rentals, and Travel 

Agents. American Express has an 

agreement with each merchant 

customer, and each agreement contains 

the price American Express charges that 

merchant. Visa and MasterCard can and 

do identify T&E merchants through their 

relationships with the merchants’ 

acquiring banks. 

45. Defendants charge merchants in 

the T&E sector higher fees than they 

charge most other merchants. Moreover, 

American Express charges T&E 

merchants higher fees than competing 

networks charge T&E merchants. The 

high fees to T&E merchants are not 

based on Defendants’ higher costs of 

serving their T&E merchants. Each 

Defendant can charge T&E merchants 

high fees because those merchants are 

even less able to substitute away to 

other networks than other merchants. 

For example, American Express 

imposed a substantial fee increase on 

major airline merchants in 2008 without 

losing any major airline merchant 

customers, even though its fees already 

were higher than those of other General 

Purpose Card networks. A substantial 

differential in card acceptance fees 

exists between General Purpose Card 

network services for merchants in T&E 

businesses and merchants in other 

businesses. 

46. Each Defendant’s price 

discrimination against T&E merchants is 

persistent and systematic. American 

Express, for example, has successfully 

maintained higher profit margins for 

T&E customers than for other merchant 

categories. 

47. Arbitrage, or indirect purchasing 

by T&E merchants of Defendants’ 

network services from other merchants 

to avoid price discrimination, is 

impossible. For example, merchants can 

buy network services for transactions 

using American Express General 

Purpose Cards only from American 

Express, and one merchant cannot resell 

American Express network services to 

another merchant. T&E merchants have 

no realistic ability to avoid Defendants’ 

high fees. 

48. T&E merchants constitute a 

distinct customer group that cannot 

easily substitute away from the card 

network their customers want to use for 

travel and entertainment purchases. 

T&E merchants (such as airline, hotel, 

and rental car merchants) depend on 

business travelers as a significant source 

of revenues. Business travelers often are 

required or encouraged by their 

employers to use corporate cards of a 

particular network to qualify for 

reimbursement from their employers. 

Customers typically make larger 

purchases from T&E merchants than 

from merchants in many other 

industries. They also often purchase 

from T&E merchants through the 

Internet. T&E merchants thus rely more 

on General Purpose Cards than many 

other merchants and are even less 

willing and able than other merchants to 

substitute from General Purpose Cards 

to alternative payment methods in 

response to high network prices. In 

short, T&E merchants have particularly 

high inelasticity of demand for General 

Purpose Card network services. 

49. Network industry participants 

recognize T&E merchants as a distinct 

market for network services. For many 

years, for example, American Express 

has had a T&E Industries Business Unit. 

Indeed, the principal operating 

subsidiary of American Express 

Company is the American Express 

Travel Related Services Company, Inc. 

50. Accordingly, a distinct, additional 

relevant market exists for General 

Purpose Card network services to T&E 

merchants. 

B. Geographic Market 

51. The United States is the relevant 

geographic market for both the sale of 

General Purpose Card network services 

to all merchants and the sale of such 

services to T&E merchants. 

52. Each Defendant treats the United 

States as a separate geographic market, 

as demonstrated in part by each 

Defendant’s separate rules governing 

merchant acceptance in the United 

States and its separate pricing of 

network services to merchants in the 

United States. Defendants can easily 

identify the location of a merchant 

outlet. Arbitrage, or indirect purchasing 

by U.S. merchants of Defendants’ 

network services from merchants 

located outside of the United States, is 

impossible. 

53. The vast majority of General 

Purpose Card transactions with 

merchants located in the United States 

are made using General Purpose Cards 

issued in the United States. Almost all 

General Purpose Cards issued in the 

United States are issued under the 

American Express, Discover, 

MasterCard, and Visa networks. Other 

networks have limited competitive 

significance for U.S. merchants, as 

reflected in their negligible share of 

sales to U.S. merchants. 

54. A hypothetical monopolist of 

General Purpose Card network services 

or General Purpose Card network 

services to T&E merchants could 

profitably maintain supracompetitive 

prices for network services provided to 

merchants in the United States over a 

sustained period of time and could 

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impose anticompetitive conditions on 

merchants in the United States even if 

merchants located outside the United 

States paid competitive prices for 

network services. 

VIII. Market Power 

55. Visa, MasterCard, and American 

Express each possess market power in 

the General Purpose Card network 

services market. The Second Circuit 

previously held that MasterCard and 

Visa each has market power in a General 

Purpose Card network services market. 

U.S. v. Visa U.S.A., Inc., 344 F.3d 229, 

238–39 (2d Cir. 2003). American 

Express also possesses market power in 

the General Purpose Card network 

services market. 

56. Merchant acceptance of 

Defendants’ General Purpose Cards is 

widespread. Merchants accounting for a 

substantial amount of General Purpose 

Card purchase volume in the United 

States accept all three Defendants’ 

General Purpose Cards. 

57. Merchants choose payment 

networks to accommodate the preferred 

payment brands of their customers. 

Some customers strongly prefer a 

particular brand and in some cases carry 

only one General Purpose Card brand. 

For example, in August 2009, 16% of 

American Express cardholders used 

only American Express and no other 

major General Purpose Cards. Such high 

cardholder insistence on using 

American Express gives American 

Express market power over merchants. 

58. Merchants also consider whether 

their competitors accept a network’s 

General Purpose Card and, if so, feel 

additional pressure to accept that 

network’s card. Indeed, many merchants 

must accept all Defendants’ General 

Purpose Cards to remain competitive 

with other merchants. 

59. Despite technological advances 

that have decreased costs associated 

with General Purpose Card transactions 

over recent decades, Visa and 

MasterCard have increased the fees they 

charge merchants without losing 

sufficient merchants to make the price 

increases unprofitable. 

60. American Express has for many 

years maintained the highest card 

acceptance fees among networks, 

including Visa and MasterCard. In 

recent years, American Express has 

increasingly been able to resist 

merchant pressure to reduce its card 

acceptance fees. American Express CEO 

Ken Chenault explained in 2009: 

At a time when many companies have had 

to cut or discount their prices and fees, we’ve 

been able to hold our own * * *. We’re not 

lowering prices to get or keep customers or 

merchants. We continue to sign new 

merchants at existing discount rate levels 

* * *. This is significantly different from the 

position we were in during the downturn of 

the early 1990’s. At that time our card and 

merchant pricing was under enormous 

pressure, and we did have to reduce fees. 

American Express has increased the fees 

it charges many merchants without 

losing sufficient merchants to make the 

price increases unprofitable. 

61. Notwithstanding these high fees, 

merchants continue to accept 

Defendants’ General Purpose Cards 

because they would face serious 

economic consequences if they ceased 

to accept any one of the three 

Defendants’ General Purpose Cards. 

Unlike customers in most markets for 

goods and services, merchants cannot 

buy fewer services from one Defendant’s 

network and buy more services from a 

competing network at the point of sale, 

even in the face of higher fees imposed 

by that network or lower fees offered by 

competing networks. A merchant’s 

efforts to reduce its purchases of one 

network’s services by encouraging its 

customers to choose another network’s 

General Purpose Card would violate 

Defendants’ Merchant Restraints. Thus, 

a merchant may resist a Defendant’s 

high card acceptance fees only by no 

longer accepting that Defendant’s cards. 

This all-or-nothing choice severely 

constrains merchants, because dropping 

any one of the Defendants’ General 

Purpose Cards could alienate customers 

and lead to significant lost sales. The 

Merchant Restraints leave merchants 

less able to avoid Defendants’ 

supracompetitive prices than they 

otherwise would be. 

62. Defendants’ ability to discriminate 

in the prices they charge different types 

of merchants, unexplained by cost 

differences, also reflects their market 

power. For example, American Express 

targets specific merchant segments for 

differential pricing based on those 

merchants’ ability to pay and their 

inability to refuse to accept American 

Express, a practice American Express 

calls ‘‘value recapture.’’ American 

Express generally charges higher fees to 

merchants that rely more on General 

Purpose Cards for their business, such 

as T&E merchants, than it charges 

merchants that traditionally rely less on 

American Express. 

63. This direct evidence of 

Defendants’ market power is consistent 

with their market share of General 

Purpose Card transaction volume. 

American Express, MasterCard, and 

Visa each has significant market shares 

in the highly concentrated General 

Purpose Card network services market. 

In 2009, the three Defendants together 

had approximately 94% of the dollar 

volume of U.S. issued General Purpose 

Cards. According to Nilson data, Visa’s 

share was approximately 43%, while 

MasterCard had a 27% share, and 

American Express had a 24% share. 

Each of these market shares is consistent 

with market power in a market with 

high concentration and other particular 

characteristics of the General Purpose 

Cards network services market. For 

example, the Second Circuit held that 

MasterCard had market power with a 

market share of 26%. U.S. v. Visa 

U.S.A., Inc., 344 F.3d at 239–40. In 

subsequent litigation, American Express 

itself alleged that MasterCard ‘‘exercised 

market power in the network services 

market’’ when MasterCard’s ‘‘share was 

approximately 26%,’’ quite similar to 

American Express’ share in the market 

for General Purpose Card network 

services to merchants today. 

64. Defendants’ acceptance among 

merchants is widespread. Visa and 

MasterCard are accepted at over 8.2 

million merchant locations in the U.S. 

In 2009, American Express was 

accepted at 4.9 million merchant 

locations in the U.S., or about 60% as 

many as accept Visa and MasterCard. In 

recent years, American Express has 

expanded its acceptance at many 

‘‘everyday spend’’ merchants, adding, for 

example, McDonalds (2004), Safeway 

(2004), Food Lion (2007) and Dollar 

Tree (2010). Today, many of the 

merchants that do not accept American 

Express are small and do not account for 

significant transaction volume. Indeed, 

American Express has stated that ‘‘as of 

the end of 2009, our merchant network 

in the United States accommodated 

more than 90% of our Cardmembers’ 

general-purpose charge and credit card 

spending.’’ 

65. Among large U.S. retailers that 

account for a substantial amount of U.S. 

transaction volume, acceptance of all 

three Defendants’ General Purpose 

Cards is widespread. For example, 95 of 

the largest 100 U.S. retailers accept all 

Defendants’ General Purpose Cards. 

And in many major merchant segments, 

Defendants’ acceptance is nearly 

universal. All major airlines, for 

instance, accept all three Defendants’ 

General Purpose Cards. 

66. Significant barriers to entry and 

expansion protect Defendants’ market 

power, and have contributed to 

Defendants’ ability to maintain high 

prices for years without threat of price 

competition by new entry or expansion 

in the market. These barriers to entry 

and expansion include the prohibitive 

cost of establishing a physical network 

over which General Purpose Card 

transactions can run, developing a 

widely recognized brand, and 

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establishing a base of merchants and a 

base of cardholders. Defendants, who 

achieved these necessities early in the 

history of the industry, obtained 

substantial early mover advantages over 

prospective subsequent entrants. 

Successful subsequent entry would be 

difficult and expensive. In the presence 

of these barriers, the only successful 

market entrant since the 1960s has been 

Discover. Even so, Discover’s market 

share historically has been, and 

remains, very small. In 2009, Discover’s 

market share based on dollar volume of 

purchases placed on General Purpose 

Cards was approximately 6%. 

67. Defendants’ Merchant Restraints 

heighten these barriers to competitors’ 

expansion and entry. Merchants’ 

inability to encourage their customers to 

use less costly General Purpose Card 

networks makes it even harder for 

existing or potential competitors to 

threaten Defendants’ market power. 

68. Each Defendant also has market 

power in the T&E market for General 

Purpose Card network services. Among 

Defendants, American Express’ market 

power in the T&E market is the most 

substantial. American Express’ share of 

transaction volume in this market is 

approximately 37%, while Visa’s share 

is approximately 36% and MasterCard’s 

share is approximately 24%. American 

Express is the market leader among 

networks in airline, lodging, and rental 

car merchant segments, capturing nearly 

$100 billion in transaction volume. 

American Express’ average card 

acceptance fee for these three merchant 

segments was 12% higher than its 

average fee for all other merchant 

segments in 2009. American Express’ 

costs in those segments are not 

proportionally higher than costs in most 

other segments; in many instances, they 

are lower. T&E merchant acceptance of 

American Express is extensive. 

American Express is the designated card 

for more business travelers than any 

other network’s card. In fact, American 

Express accounts for 70% of all 

expenditures made with corporate 

cards, which consist largely of T&E 

merchant purchases. Most merchants in 

the T&E market have not declined to 

accept American Express’ cards or its 

Merchant Restraints even when 

American Express has imposed card 

acceptance fees that are substantially 

higher than those set by other General 

Purpose Card brands, despite these 

merchants’ strong desire not to accept 

those prices and restraints. Visa and 

MasterCard also price discriminate 

successfully against T&E merchants. For 

all of these reasons, each Defendant has 

market power in the T&E market. 

IX. Harm to Competition 

69. Each Defendants’ vertical 

Merchant Restraints are directly aimed 

at restraining horizontal interbrand 

competition. Each Defendant’s 

Merchant Restraints harm competition 

by: 

(1) Harming the competitive process 

and disrupting the proper functioning of 

the price-setting mechanism of a free 

market; 

(2) restraining merchants from 

encouraging or pressing each Defendant 

to compete over card acceptance fees; 

(3) insulating each Defendant from 

competition from rival networks that 

would otherwise encourage merchants 

to favor use of those networks’ cards; 

(4) inhibiting other networks from 

competing on price at merchants that 

accept each Defendant’s General 

Purpose Cards; 

(5) restraining merchants from 

promoting payment methods other than 

each Defendant’s General Purpose 

Cards; 

(6) restraining merchants from 

competing for customers with 

discounts, promotions, or other forms of 

lower prices and other benefits enabled 

by customers’ use of a lower cost 

General Purpose Card or other payment 

method; 

(7) causing increased prices in the 

form of higher merchant card 

acceptance fees; 

(8) causing increased retail prices for 

goods and services paid generally by 

customers; 

(9) reducing output of lower-cost 

payment methods; 

(10) stifling innovation in network 

services and card offerings that would 

emerge if competitors were forced to 

compete for merchant business at the 

point of sale; and 

(11) denying consumers information 

about the relative costs of each 

Defendant’s General Purpose Card usage 

compared to other card usage that 

would cause more consumers to choose 

lower-cost payment methods. 

70. Defendants’ Merchant Restraints 

substantially reduce price and non-price 

competition for merchant use of 

network services and interfere with 

price setting at the merchant point of 

sale. Without the Merchant Restraints, 

and faced with Defendants’ high card 

acceptance fees, many merchants would 

encourage customers to use cards 

offered by the lowest-cost network. 

Without the Merchant Restraints, each 

Defendant would compete more 

vigorously. By imposing the Merchant 

Restraints, Defendants have insulated 

themselves from competition with each 

other and with any other network 

competitor at the merchant point of sale. 

The Merchant Restraints reduce 

incentives for Defendants to offer 

merchants lower-priced network 

services that would benefit consumers, 

because merchants cannot encourage 

customers to use the less expensive 

options without violating Defendants’ 

Merchant Restraints. Each Defendant 

thus can maintain high prices for its 

network services with confidence that 

no competitor will take away significant 

transaction volume through competition 

in the form of merchant discounts or 

benefits to consumers to use lower cost 

payment options. Each Defendant’s 

price for network services to merchants 

is higher than it would be without the 

Merchant Restraints. 

LXXI. Although other payment 

methods are not in the product markets 

relevant to this action, there is some, 

more attenuated competition between 

General Purpose Cards and other 

payment methods. Defendants’ 

Merchant Restraints also restrict the 

competition that exists and otherwise 

would emerge from these other payment 

methods. 

LXXII. Because Defendants’ Merchant 

Restraints obstruct merchants from 

encouraging customers to use less costly 

payment methods, merchants bear 

higher costs and their customers face 

higher retail prices. If a merchant cannot 

reduce its costs by encouraging cheaper 

payment methods or by encouraging 

competition among networks, the 

merchant will charge higher prices 

generally to its customers. A customer 

who pays with lower-cost methods of 

payment pays more than he or she 

would if Defendants did not prevent 

merchants from encouraging network 

competition at the point of sale. For 

example, because American Express 

General Purpose Cards typically are 

held by more affluent buyers, less 

affluent purchasers using non-premium 

General Purpose Cards, debit cards, 

cash, and checks effectively subsidize 

part of the cost of expensive American 

Express card benefits and rewards. 

LXXIII. The fees Defendants impose 

on General Purpose Card transactions 

are largely not visible to consumers. The 

Merchant Restraints forbid merchants 

even from telling consumers simple 

factual information about what 

merchants have to pay when consumers 

use General Purpose Cards. This 

information could help merchants to 

encourage customers to choose more 

cost-effective payment methods. For 

example, those customers who prefer 

American Express services and value 

them at a competitive price could 

continue to choose them, but others 

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would not be forced to subsidize this 

choice by paying higher prices. 

LXXIV. Authorities in other countries 

have taken actions to reduce or 

eliminate similar Merchant Restraints. 

In foreign jurisdictions where 

Defendants’ Merchant Restraints have 

been relaxed, merchants have taken 

advantage of their ability to encourage 

customers to use less expensive General 

Purpose Cards or other payment 

methods. 

LXXV. In short, Defendants’ Merchant 

Restraints remove tools that merchants 

in a competitive marketplace would use 

to negotiate lower card acceptance fees, 

to reduce their costs of doing business, 

to empower their customers with 

information to make choices about 

payment methods, to encourage 

customers to choose a low-cost payment 

method, and to keep retail prices lower 

for their customers. As a result, 

merchants, consumers, and competition 

itself are harmed. 

X. Violation Alleged 

LXXVI. Each Defendant’s Merchant 

Restraints constitute agreements that 

unreasonably restrain competition in 

the market for General Purpose Card 

network services to merchants, and in 

the market for General Purpose Card 

network services to T&E merchants, in 

the United States in violation of Section 

1 of the Sherman Act, 15 U.S.C. 1. 

LXXVII. These agreements have had 

and will continue to have 

anticompetitive effects by protecting 

Defendants from competition over the 

cost of card acceptance to merchants, 

and restraining merchants from 

encouraging customers to use lower-cost 

payment methods. Defendants’ 

restraints unlawfully insulate 

Defendants’ card acceptance fees from 

competition, increase costs of payment 

acceptance to merchants, increase 

prices, reduce output, harm the 

competitive process, raise barriers to 

entry and expansion, and retard 

innovation. 

LXXVIII. These agreements are not 

reasonably necessary to accomplish any 

of Defendants’ allegedly procompetitive 

goals. Any procompetitive benefits are 

outweighed by anticompetitive harm, 

and there are less restrictive alternatives 

by which Defendants would be able 

reasonably to achieve any 

procompetitive goals. 

XI. Request for Relief 

Wherefore, Plaintiffs pray that final 

judgment be entered against each 

Defendant declaring, ordering, and 

adjudging that: 

a. The aforesaid agreements 

unreasonably restrain trade and are 

illegal under Section 1 of the Sherman 

Act, 15 U.S.C. 1; 

b. Each Defendant be permanently 

enjoined from engaging in, enforcing, 

carrying out, renewing, or attempting to 

engage in, enforce, carry out, or renew 

the agreements in which it is alleged to 

have engaged, or any other agreement 

having a similar purpose or effect in 

violation of Section 1 of the Sherman 

Act, 15 U.S.C. 1; 

c. Each Defendant eliminate and cease 

enforcing all Merchant Restraints and be 

prohibited from otherwise acting to 

restrain trade unreasonably; 

d. Each Defendant fund and 

undertake programs to inform 

merchants of merchants’ rights to 

encourage customers to use any 

payment method they choose; and 

e. The United States be awarded its 

costs of this action and such other relief 

as may be appropriate and as the Court 

may deem just and proper, and the 

States be awarded their costs in this 

action, reasonable attorneys’ fees, and 

such other relief as may be appropriate 

and as the Court may deem proper. 

Dated: 10/4/2010. 

FOR PLAINTIFF 

THE UNITED STATES OF AMERICA 

llll/s/llllllll 

CHRISTINE A. VARNEY 

Assistant Attorney General 

llll/s/llllllll 

MOLLY S. BOAST 

Deputy Assistant Attorney General 

llll/s/llllllll 

J. ROBERT KRAMER II 

Director of Operations 

llll/s/llllllll 

JOHN READ 

Chief, Litigation III Section 

DAVID KULLY 

Assistant Chief, Litigation III Section 

llll/s/llllllll 

CRAIG W. CONRATH 

MICHAEL G. DASHEFSKY 

JUSTIN M. DEMPSEY 

MARK H. HAMER 

GREGG I. MALAWER 

BENNETT MATELSON 

ANNE NEWTON MCFADDEN 

RACHEL L. ZWOLINSKI 

Attorneys for the United States of 

America 

U.S. Department of Justice 

Antitrust Division, Litigation III Section 

450 Fifth Street, N.W., Suite 4000 

Washington, DC 20530 

Telephone: (202) 307–0468 

DOUGLAS F. GANGSLER 

MARYLAND ATTORNEY GENERAL 

llll/s/llllllll 

Ellen S. Cooper 

Assistant Attorney General 

Chief, Antitrust Division 

llll/s/llllllll 

Gary Honick 

Assistant Attorney General 

Office of the Attorney General 

Antitrust Division 

200 St. Paul Place, 19th Floor 

Baltimore, Maryland 21202 

Tel. # (410)576–6470 

Fax # (410)576–7830 

PLAINTIFF 

STATE OF CONNECTICUT 

RICHARD BLUMENTHAL 

Attorney General 

llll/s/llllllll 

Michael E. Cole 

Chief, Antitrust Department 

Rachel O. Davis 

Assistant Attorneys General 

Antitrust Department 

55 Elm Street, P.O. Box 120 

Hartford, CT 06141–0120 

Tel: (860) 808–5040 

Fax: (860) 808–5033 

STATE OF IOWA 

Thomas J. Miller 

Attorney General of Iowa 

llll/s/llllllll 

Layne M. Lindebak 

Assistant Attorney General 

Special Litigation Division 

Iowa Department of Justice 

Hoover Office Building-Second Floor 

1305 East Walnut Street 

Des Moines, Iowa 50319 

Phone: 515 281–7054 

Fax: 515 281–4902 

Email: Layne.Lindebak@iowa.gov 

STATE OF MICHIGAN 

MICHAEL A. COX 

Attorney General 

llll/s/llllllll 

D. J. Pascoe 

Assistant Attorney General 

Michigan Department of Attorney 

General 

Corporate Oversight Division 

Securities, Antitrust, and Business 

Section 

G. Mennen Williams Building, 6th Floor 

525 W. Ottawa Street 

Lansing, Michigan 48933 

Telephone: (517) 373–1160 

Fax: (517) 335–6755 

pascoed1@michigan.gov 

FOR THE STATE OF MISSOURI 

llll/s/llllllll 

CHRIS KOSTER 

Attorney General 

ANNE E. SCHNEIDER 

Assistant Attorney General/Antitrust 

Counsel 

ANDREW M. HARTNETT 

Assistant Attorney General 

P. O. Box 899 

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62866 Federal Register / Vol. 75, No. 197 / Wednesday, October 13, 2010 / Notices 

Jefferson City, MO 65102 

Tel: (573) 751–7445 

Tel: (573) 751–2041 (facsimile) 

E-mail: Anne.Schneider@ago.mo.gov 

ATTORNEY GENERAL OF THE STATE 

OF OHIO 

Richard Cordray 

Attorney General of Ohio 

Jennifer L. Pratt 

Section Chief, Antitrust Section 

llll/s/llllllll 

Mitchell L. Gentile 

Principal Attorney, Antitrust Section 

Patrick E. O’Shaughnessy 

Senior Assistant Attorney General, 

Antitrust Section 

Office of the Ohio Attorney General 

150 E. Gay Street, 23rd Floor 

Columbus, Ohio 43215 

(614) 466–4328 

(614) 955–0266 (fax) 

GREG ABBOTT 

Attorney General of Texas 

DANIEL T. HODGE 

First Assistant Attorney General 

BILL COBB 

Deputy Attorney General for Civil 

Litigation 

JOHN T. PRUD’HOMME 

Assistant Attorney General 

Chief, Antitrust Division 

llll/s/llllllll 

KIM VAN WINKLE 

Assistant Attorney General 

State Bar No. 24003104 

BRET FULKERSON 

State Bar No. 24032209 

Office of the Attorney General of Texas 

P. O. Box 12548 

Austin, Texas 78711–2548 

512/463–1266 (Telephone) 

512/320–0975 (Facsimile) 

In The United States District Court For 

The Eastern District of New York 

United States of America, State of 

Connecticut, State of Iowa, State of 

Maryland, State of Michigan, State of 

Missouri, State of Ohio, and State of 

Texas, Plaintiffs, v. American Express 

Company, American Express Travel 

Related Services Company, Inc., 

Mastercard International Incorporated, 

and Visa Inc. Defendants. 

Civil Action No. CV–10–4496 

(Garaufis, J.) 

(Pollak, M.J.) 

Competitive Impact Statement 

Plaintiff United States of America 

(‘‘United States’’), pursuant to Section 

2(b) of the Antitrust Procedures and 

Penalties Act (‘‘APPA’’ or ‘‘Tunney Act’’), 

15 U.S.C. 16(b)–(h), files this 

Competitive Impact Statement relating 

to the proposed Final Judgment 

submitted for entry in this civil antitrust 

proceeding. 

I. Nature and Purpose of The 

Proceeding 

The United States and the States of 

Connecticut, Iowa, Maryland, Michigan, 

Missouri, Ohio, and Texas (‘‘Plaintiff 

States’’) brought this lawsuit against 

Defendants American Express 

Company, American Express Travel 

Related Services Company, Inc. 

(collectively, ‘‘American Express’’), Visa 

Inc. (‘‘Visa’’), and MasterCard 

International Incorporated 

(‘‘MasterCard’’) on October 4, 2010, 

challenging certain of Defendants’ rules, 

policies, and practices that impede 

merchants from providing discounts or 

benefits to promote the use of a 

competing credit card that costs the 

merchant less to accept (‘‘Merchant 

Restraints’’). These Merchant Restraints 

have the effect of suppressing 

interbrand price and non-price 

competition in violation of Section 1 of 

the Sherman Act, 15 U.S.C. 1. 

Shortly after the filing of the 

Complaint, the United States filed a 

proposed Final Judgment with respect 

to Defendants Visa and MasterCard. The 

proposed Final Judgment is described in 

more detail in Section III below. The 

United States, Plaintiff States, Visa, and 

MasterCard have stipulated that the 

proposed Final Judgment may be 

entered after compliance with the 

APPA, unless the United States 

withdraws its consent. Entry of the 

proposed Final Judgment would 

terminate this action as to Visa and 

MasterCard, except that this Court 

would retain jurisdiction to construe, 

modify, and enforce the proposed Final 

Judgment and to punish violations 

thereof. The case against American 

Express will continue. 

II. Description of The Events Giving 

Rise to The Alleged Violation 

A. Industry Background 

Defendants provide network services 

for general purpose credit and charge 

cards (‘‘General Purpose Cards’’). Visa is 

the largest provider of network services 

in the United States and MasterCard is 

the second-largest, closely followed by 

American Express. 

General Purpose Cards are forms of 

payment that allow cardholders to make 

purchases without accessing or 

reserving the cardholder’s funds at the 

time of sale. General Purpose Cards 

include credit and charge cards issued 

to consumers and businesses, but do not 

include cards that can be used at only 

one merchant (e.g., department store 

cards), cards that access funds on 

deposit (debit cards), or pre-paid cards 

(e.g., gift cards). Acceptance of General 

Purpose Cards is widespread among 

merchants because many of their 

customers prefer to pay with such 

Cards, due to convenience, security, the 

ability to defer payment, and other 

factors. 

Defendants, as providers of General 

Purpose Card network services, operate 

the infrastructure necessary to 

authorize, settle, and clear payments 

made with their General Purpose Cards. 

Millions of merchants around the 

United States that accept General 

Purpose Cards are consumers of 

network services. 

The typical transaction involving a 

Visa or MasterCard General Purpose 

Card involves several steps. When a 

cardholder presents a card to a 

merchant, the bank that issued the card 

(the ‘‘issuing bank’’ or ‘‘issuer’’) 

authorizes the transaction using the 

card’s network. Then the merchant’s 

bank (the ‘‘acquiring bank’’) pays the 

merchant the amount of the purchase, 

minus a fee (the ‘‘merchant discount fee’’ 

or ‘‘card acceptance fee’’) that is shared 

among the acquiring bank, the network, 

and the issuing bank. The acquiring 

bank and the network collect relatively 

small portions of the merchant discount; 

the bulk of the merchant discount is 

collected by the issuing bank in the 

form of an ‘‘interchange fee.’’ 

Interchange fees are set by the network 

and vary based on many factors such as 

the merchant’s industry, the merchant’s 

annual charge levels, and the type of 

card used in the transaction (e.g., 

rewards card vs. non-rewards card). 

American Express issues most of its 

General Purpose Cards directly to 

cardholders and generally provides 

network services directly to merchants. 

For each transaction, American Express 

imposes a merchant discount fee, which 

is typically a percentage of the 

transaction price. American Express has 

for many years maintained the highest 

merchant fees of any network, and 

American Express card acceptance often 

costs merchants substantially more than 

acceptance of other General Purpose 

Cards. 

When merchants agree to accept a 

particular brand of General Purpose 

Card, they must use the network 

services provided by that brand. 

Merchants cannot reasonably replace 

General Purpose Card network services 

with other services or reduce usage of 

these network services, even if such 

network services are substantially more 

expensive for merchants relative to 

services that enable other payment 

methods. The challenged Merchant 

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1Federal law mandates that networks permit 

merchants to offer discounts for cash transactions. 

Additionally, the new Dodd-Frank Wall Street 

Reform and Consumer Protection Act of 2010, by 

adding section 920 to the Electronic Fund Transfer 

Act, 15 U.S.C. 1693 et seq., now forbids networks 

from prohibiting merchants from offering a discount 

for an entire payment method category, such as a 

discount for use of any debit card. All General 

Purpose Card networks operate under these laws. 

The Complaint does not seek relief relating to these 

two types of discounting. 

Restraints obstruct the ability of a 

merchant to vary the amount of network 

services it buys in response to changes 

in the merchant’s cost of acceptance by 

encouraging customers at the point of 

sale to use less-costly General Purpose 

Cards or other methods of payment. 

B. The Challenged Merchant Restraints 

When merchants agree to accept Visa 

or MasterCard General Purpose Cards, 

they sign a contract agreeing to abide by 

the rules promulgated by the network, 

including the Merchant Restraints at 

issue in this case. Merchants face 

penalties, including termination of their 

contracts, if they violate these rules. 

The Visa Merchant Restraints 

challenged in the Complaint prohibit a 

merchant from offering a discount at the 

point of sale to a customer that chooses 

to use an American Express, Discover, 

or MasterCard General Purpose Card 

instead of a Visa General Purpose Card. 

Visa’s rules do not allow discounts for 

other General Purpose Cards, unless 

such discounts are equally available for 

Visa transactions. See Complaint ¶ 26 

(citing Visa International Operating 

Regulations at 445 (April 1, 2010) 

(Discount Offer—U.S. Region 5.2.D.2)). 

The MasterCard Merchant Restraints 

challenged in the Complaint prohibit a 

merchant from ‘‘engag[ing] in any 

acceptance practice that discriminates 

against or discourages the use of a 

[MasterCard] Card in favor of any other 

acceptance brand.’’ See Complaint ¶ 27 

(quoting MasterCard Rule 5.11.1). This 

means that merchants cannot offer 

discounts or other benefits to persuade 

customers to use an American Express, 

Discover, or Visa General Purpose Card 

instead of a MasterCard General Purpose 

Card. Id. MasterCard does not allow 

merchants to favor competing card 

brands. Id. 

The challenged Merchant Restraints 

imposed by Defendants deter or obstruct 

merchants from freely promoting 

interbrand competition among networks 

by offering customers discounts, other 

benefits, or information to encourage 

them to use a less-expensive General 

Purpose Card brand or other payment 

method. The Merchant Restraints block 

merchants from taking steps to 

influence customers and foster 

competition among networks at the 

point of sale, such as: promoting a lessexpensive General Purpose Card brand 

more actively than any other brand; 

offering customers a discount or other 

benefit for using a particular General 

Purpose Card that costs the merchant 

less; posting a sign expressing a 

preference for another General Purpose 

Card brand; prompting customers at the 

point of sale to use another General 

Purpose Card brand in their wallets; 

posting the signs or logos of General 

Purpose Card brands that cost less to the 

merchant more prominently than signs 

or logos of more costly brands; or 

posting truthful information comparing 

the relative costs of different General 

Purpose Card brands.1

C. The Relevant Markets 

The Complaint alleges two distinct 

relevant product markets: the market for 

General Purpose Card network services 

to merchants, and the market for 

General Purpose Card network services 

to travel and entertainment merchants 

(‘‘T&E market’’). In each case, the 

relevant geographic market is the United 

States. 

1. The General Purpose Card Network 

Services Market 

A relevant product market for this 

case is the provision of General Purpose 

Card network services to merchants. For 

such merchants, there are no reasonable 

substitutes for network services. 

Competition from other payment 

methods would not be sufficient to 

prevent a hypothetical monopolist of 

General Purpose Card network services 

from profitably maintaining 

supracompetitive prices and terms for 

network services provided to merchants 

over a sustained period of time or from 

imposing anticompetitive conditions on 

merchants. 

Defendants possess market power in 

the network services market. In 2003, 

the United States Court of Appeals for 

the Second Circuit affirmed that Visa 

and MasterCard hold market power in a 

General Purpose Card network services 

market. United States v. Visa U.S.A., 

Inc., 344 F.3d 229, 238–39 (2d Cir. 

2003). American Express’ share of 

General Purpose Card transaction 

volume today is close to MasterCard’s, 

and similar to MasterCard’s share at the 

time of the Second Circuit’s decision. 

Because of the Merchant Restraints, a 

merchant is obstructed in its ability to 

reduce its purchases of one network’s 

services by encouraging its customers to 

choose a competing network’s General 

Purpose Card. A merchant may resist a 

Defendant’s high card acceptance fees 

only by no longer accepting that 

Defendant’s General Purpose Cards. 

This all-or-nothing choice does not 

effectively constrain Defendants’ market 

power because merchants cannot refuse 

to accept these General Purpose Cards 

without alienating customers and losing 

significant sales. The Merchant 

Restraints leave merchants less able to 

avoid Defendants’ supracompetitive 

prices than they otherwise would be. 

Defendants’ ability to discriminate in 

the prices they charge different types of 

merchants, unexplained by cost 

differences, also reflects their market 

power. Defendants target specific 

merchant segments for differential 

pricing based on those merchants’ 

ability to pay and their inability to 

refuse to accept Defendants’ General 

Purpose Cards. 

Significant barriers to entry and 

expansion protect Defendants’ market 

power, and have contributed to 

Defendants’ ability to maintain high 

prices for years without threat of price 

competition by new entry or expansion 

in the market. Barriers to entry and 

expansion include the prohibitive cost 

of establishing a physical network over 

which General Purpose Card 

transactions can run, developing a 

widely recognized brand, and 

establishing a base of merchants and a 

base of cardholders. Defendants, which 

achieved these necessities early in the 

history of the industry, hold substantial 

early-mover advantages over 

prospective subsequent entrants. 

Successful entry today would be 

difficult, time consuming, and 

expensive. 

2. The T&E Market 

Another relevant market consists of 

General Purpose Card network services 

provided to merchants in travel and 

entertainment businesses (e.g., 

merchants offering air travel, lodging, or 

rental cars). The T&E market is what is 

sometimes termed a ‘‘price 

discrimination market.’’ Merchants in 

this market share distinct characteristics 

in their usage of General Purpose Card 

network services, can be readily 

identified by Defendants, and are 

subject to price discrimination by 

Defendants. Price discrimination occurs 

when a seller charges different 

customers (or groups of customers) 

different prices for the same services, 

when those different prices are not 

based on different costs of serving those 

customers. 

Here, Defendants charge merchants in 

the T&E sector higher fees than they 

charge most other merchants. The high 

fees to T&E merchants are not based on 

Defendants’ higher costs of serving their 

T&E merchants. Each Defendant can 

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2 Visa and MasterCard may enter into the latter 

type of agreement subject to certain conditions: (a) 

The agreement is individually negotiated with the 

merchant and is not part of a standard merchant 

contract; and (b) the merchant’s acceptance of the 

Defendant’s General Purpose Card is unrelated to, 

and not conditioned on, the merchant’s entry into 

the agreement. Id. § IV.B.3. 

charge T&E merchants high fees because 

those merchants are even less able to 

substitute away to other networks than 

other merchants. 

Competition from other payment 

methods would not be sufficient to 

prevent a hypothetical monopolist in 

the T&E market from either profitably 

maintaining supracompetitive prices 

and terms for network services to T&E 

merchants over a sustained period of 

time or imposing anticompetitive 

conditions on T&E merchants in that 

market. A hypothetical monopolist 

could price discriminate profitably 

against T&E merchants even if other 

merchants were paying lower prices for 

network services. 

Each Defendant holds market power 

in the T&E market. As with the market 

for General Purpose Card network 

services, discussed above, significant 

barriers to entry and expansion protect 

the market for network services to T&E 

merchants. 

D. The Competitive Effects of the 

Alleged Violation 

The Complaint alleges that 

Defendants’ Merchant Restraints 

suppress price and non-price 

competition by prohibiting a merchant 

from offering discounts or other benefits 

to customers for the use of a particular 

General Purpose Card. These 

prohibitions allow Defendants to 

maintain high prices for network 

services with confidence that no 

competitor will take away significant 

transaction volume through competition 

in the form of merchant discounts or 

benefits to customers to use lower cost 

payment options. Defendants’ prices for 

network services to merchants are 

therefore higher than they would be 

without the Merchant Restraints. 

Absent the Merchant Restraints, 

merchants would be free to use various 

methods, such as discounts or non-price 

benefits, to encourage customers to use 

the brands of General Purpose Cards 

that impose lower costs on the 

merchants. In order to retain merchant 

business, the networks would need to 

respond to merchant preferences by 

competing more vigorously on price and 

service to merchants. The increased 

competition among networks would 

lead to lower merchant fees and better 

service terms. 

Because the Merchant Restraints 

result in higher merchant costs, and 

merchants pass these costs on to 

consumers, retail prices are higher 

generally for consumers. Moreover, a 

customer who pays with lower-cost 

methods of payment pays more than he 

or she would if Defendants did not 

prevent merchants from encouraging 

network competition at the point of sale. 

For example, because certain types of 

premium General Purpose Cards tend to 

be held by more affluent buyers, less 

affluent purchasers using non-premium 

General Purpose Cards, debit cards, 

cash, and checks effectively subsidize 

part of the cost of expensive premium 

card benefits and rewards enjoyed by 

those cardholders. 

The Complaint also alleges that the 

Merchant Restraints have had a number 

of other anticompetitive effects, 

including reducing output of lower-cost 

payment methods, stifling innovation in 

network services and card offerings, and 

denying information to customers about 

the relative costs of General Purpose 

Cards that would cause more customers 

to choose lower-cost payment methods. 

Defendants’ Merchant Restraints also 

have heightened the already high 

barriers to entry and expansion in the 

network services market. Merchants’ 

inability to encourage their customers to 

use less-costly General Purpose Card 

networks makes it more difficult for 

existing or potential competitors to 

threaten Defendants’ market power. 

Finally, the Complaint alleges that 

these anticompetitive effects are not 

outweighed by any allegedly 

procompetitive goals of the Merchant 

Restraints, and there are less restrictive 

alternatives by which Defendants would 

be able reasonably to achieve any 

procompetitive goals. 

III. Explanation of The Proposed Final 

Judgment 

The prohibitions and required 

conduct in the proposed Final Judgment 

achieve all the relief sought from Visa 

and MasterCard in the Complaint, and 

thus fully resolve the competitive 

concerns raised by those Defendants’ 

Merchant Restraints challenged in this 

lawsuit. 

The proposed Final Judgment 

prohibits Visa and MasterCard from 

adopting, maintaining, or enforcing any 

rule, or entering into or enforcing any 

agreement, that prevents any merchant 

from: (1) Offering the customer a price 

discount, rebate, free or discounted 

product or service, or other benefit if the 

customer uses a particular brand or type 

of General Purpose Card or particular 

form of payment; (2) expressing a 

preference for the use of a particular 

brand or type of General Purpose Card 

or particular form of payment; (3) 

promoting a particular brand or type of 

General Purpose Card or particular form 

of payment through posted information; 

through the size, prominence, or 

sequencing of payment choices; or 

through other communications to the 

customer; or (4) communicating to 

customers the reasonably estimated or 

actual costs incurred by the merchant 

when a customer pays with a particular 

brand or type of General Purpose Card. 

Proposed Final Judgment § IV.A. 

For purposes of the Final Judgment, 

the ‘‘brand’’ of a General Purpose Card 

refers to its network (e.g., American 

Express, Discover, MasterCard, or Visa). 

Id. § II.3. The ‘‘type’’ of a General 

Purpose Card refers to the network’s 

card categories, such as premium cards 

(e.g., a ‘‘Visa Signature Card’’ or a 

‘‘World MasterCard’’), rewards cards, or 

traditional cards. Id. § II.16. The term 

‘‘form of payment’’ is defined as any 

means by which customers pay for 

goods and services, including cash, a 

check, a debit card, a prepaid card, or 

other means. Id. § II.7. The definition 

includes particular brands or types of 

debit cards. 

The purpose of Section IV.A is to free 

merchants to influence the method of 

payment used by their customers by 

providing them information, discounts, 

benefits, and choices at the point of sale. 

For example, merchants will be able to 

encourage customers, using the methods 

described in Section IV.A, to use one 

General Purpose Card instead of 

another, to use one type of General 

Purpose Card instead of another (such 

as by offering a discount for the use of 

a cheaper non-rewards Visa card instead 

of a premium-level Visa rewards card), 

or to use a different General Purpose 

Card or form of payment than the 

General Purpose Card the customer 

initially presents to the merchant. 

Merchants will also be able to encourage 

the use of any other payment form, such 

as cash, check, or debit cards, by using 

the methods described in Section IV.A. 

To clarify the scope of the conduct 

prohibited by the proposed Final 

Judgment, Section IV.B provides that 

Visa and MasterCard would not violate 

the Final Judgment if they established 

agreements with merchants, pursuant to 

which: (1) The merchant agrees to 

accept only one brand of General 

Purpose Card; (2) the merchant 

encourages customers to use co-branded 

or affinity General Purpose Cards with 

the merchant’s own brand on the card, 

and not other General Purpose Cards; or 

(3) the merchant encourages customers 

to use only one brand of General 

Purpose Card.2 The General Purpose 

Card networks likely will compete with 

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3The Antitrust Division has investigated a 

number of Defendants’ other merchant rules, 

including the prohibition on surcharging, that are 

not challenged in this Complaint. Tunney Act 

review is limited to the scope of the complaint and 

the court may not ‘‘reach beyond the complaint to 

evaluate claims that the government did not make 

Continued 

each other to enter these types of 

agreements, to the benefit of merchants 

and consumers. 

Section IV.B also allows Visa and 

MasterCard to have a network rule that 

prohibits a merchant from encouraging 

customers to use the General Purpose 

Cards of one issuing bank instead of 

those of another issuing bank. 

Section IV.C allows Visa and 

MasterCard to have a network rule that 

prohibits a merchant from disparaging 

the network’s brand, as long as that rule 

does not restrict a merchant’s ability to 

encourage customers to use other 

General Purpose Cards or forms of 

payment. 

To facilitate merchants’ ability to 

encourage customers to use particular 

General Purpose Cards, Section IV.D 

prevents Visa and MasterCard from 

denying merchants access to 

information from their acquiring banks 

about the cost of each type of General 

Purpose Card. 

Section V of the proposed Final 

Judgment requires Visa and MasterCard, 

within five days of entry of the 

Judgment, to ‘‘delete, discontinue, and 

cease to enforce’’ any rule that would be 

prohibited by Section IV of the Final 

Judgment. Id. § V.A. Sections V.B and 

V.C require Visa and MasterCard to 

make specific changes to their rules and 

regulations governing merchant conduct 

to implement the requirements of 

Section IV. Section V also directs Visa 

and MasterCard, through their acquiring 

banks, to notify merchants of the rules 

changes mandated by the Final 

Judgment, and of the fact that merchants 

are now permitted to encourage 

customers to use a particular General 

Purpose Card or form of payment. 

Acquiring banks must also provide 

merchants with a copy of the Final 

Judgment. Finally, Section V requires 

Visa and MasterCard to adopt rules that 

prohibit their acquiring banks from 

adopting, maintaining, or enforcing any 

rule that would be inconsistent with the 

prohibitions of Section IV of the Final 

Judgment. 

To aid in enforcement, the proposed 

Final Judgment requires Visa and 

MasterCard to notify the Department of 

Justice of any future rule change that 

limits or restrains ‘‘how Merchants 

accept, process, promote, or encourage 

use of Forms of Payment other than 

General Purpose Cards or of General 

Purpose Cards bearing the Brand of 

another General Purpose Card Network.’’ 

Id. § V.F. 

The proposed Final Judgment 

expressly states that there is no 

limitation on the United States’ (or the 

Plaintiff States’) ability to investigate 

and bring an antitrust enforcement 

action in the future concerning any rule 

of either Visa or MasterCard, including 

any rule either of them may adopt in the 

future. Id. § VIII. Merchants that 

currently accept only Visa or 

MasterCard, or both, will benefit 

immediately from the Final Judgment by 

having the freedom to encourage their 

customers to choose the merchants’ 

preferred method of payment. 

Merchants will have several new 

options available to accomplish this, 

such as offering customers a price 

discount, a rebate, a free product or 

service, rewards program points, or 

other benefits; placing signs that 

encourage customers to use particular 

payment methods; prompting customers 

to use particular General Purpose Cards 

or other forms of payment; or 

communicating to customers the costs 

of particular forms of payment. 

Merchants that accept American 

Express cards, including the vast 

majority of the major retailers in the 

United States, will be unable to 

influence customers’ payment methods 

because the anticompetitive American 

Express Merchant Restraints will 

continue to constrain those merchants 

pending the outcome of this litigation. 

American Express stands as the last 

obstacle to achieving the full benefits of 

competition now suppressed by the 

challenged Merchant Restraints. The 

United States will continue this case 

against American Express to obtain 

complete relief for the affected 

merchants, and for the benefit of their 

customers. 

IV. Remedies Available To Potential 

Private Litigants 

Section 4 of the Clayton Act, 15 

U.S.C. 15, provides that any person who 

has been injured as a result of conduct 

prohibited by the antitrust laws may 

bring suit in federal court to recover 

three times the damages the person has 

suffered, as well as costs and reasonable 

attorneys’ fees. Entry of the proposed 

Final Judgment will neither impair nor 

assist the bringing of any private 

antitrust damage action. Under the 

provisions of Section 5(a) of the Clayton 

Act, 15 U.S.C. 16(a), the proposed Final 

Judgment has no prima facie effect in 

any private lawsuit that may be brought 

against Defendants. 

V. Procedures Available For 

Modification of The Proposed Final 

Judgment 

The United States, Plaintiff States, 

Visa, and MasterCard have stipulated 

that the proposed Final Judgment may 

be entered by the Court after compliance 

with the provisions of the APPA, 

provided that the United States has not 

withdrawn its consent. The APPA 

conditions entry upon the Court’s 

determination that the proposed Final 

Judgment is in the public interest. 

The APPA provides a period of at 

least sixty (60) days preceding the 

effective date of the proposed Final 

Judgment within which any person may 

submit to the United States written 

comments regarding the proposed Final 

Judgment. Any person who wishes to 

comment should do so within sixty (60) 

days of the date of publication of this 

Competitive Impact Statement in the 

Federal Register, or the last date of 

publication in a newspaper of the 

summary of this Competitive Impact 

Statement, whichever is later. All 

comments received during this period 

will be considered by the United States 

Department of Justice, which remains 

free to withdraw its consent to the 

proposed Final Judgment at any time 

prior to the Court’s entry of judgment. 

The comments and the response of the 

United States will be filed with the 

Court and published in the Federal 

Register. 

Written comments should be 

submitted to: John R. Read, Chief, 

Litigation III Section, Antitrust Division, 

United States Department of Justice, 450 

Fifth Street, NW., Suite 4000, 

Washington, DC 20530. 

The proposed Final Judgment 

provides that the Court retains 

jurisdiction over this action, and the 

parties may apply to the Court for any 

order necessary or appropriate for the 

modification, interpretation, or 

enforcement of the Final Judgment. 

VI. Alternatives To The Proposed Final 

Judgment 

The United States considered, as an 

alternative to the proposed Final 

Judgment, proceeding to a full trial on 

the merits against Visa and MasterCard. 

The United States is satisfied, however, 

that the prohibitions and requirements 

contained in the proposed Final 

Judgment will fully address the 

competitive concerns set forth in the 

Complaint against Visa and MasterCard. 

The proposed Final Judgment achieves 

all or substantially all of the relief the 

United States would have obtained 

through litigation against Visa and 

MasterCard, and will avoid the delay, 

risks, and costs of a trial on the merits 

of the Complaint.3

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and to inquire as to why they were not made.’’ 

United States v. Microsoft, 56 F.3d 1448, 1459–60 

(DC Cir. 1995); see also infra § VII, at 20. The 

proposed Final Judgment contains a clause 

preserving the rights of the United States and 

providing that ‘‘[n]othing in this Final Judgment 

shall limit the right of the United States or of the 

Plaintiff States to investigate and bring actions to 

prevent or restrain violations of the antitrust laws 

concerning any Rule of MasterCard or Visa, 

including any current Rule and any Rule adopted 

in the future.’’ Proposed Final Judgment § VIII. At 

this time, the United States takes no position on 

whether any Visa or MasterCard rule not challenged 

in the Complaint is in violation of the antitrust 

laws. 

4The 2004 amendments substituted ‘‘shall’’ for 

‘‘may’’ in directing relevant factors for the court to 

consider and amended the list of factors to focus on 

competitive considerations and to address 

potentially ambiguous judgment terms. Compare 15 

U.S.C. 16(e) (2004), with 15 U.S.C. 16(e)(1) (2006); 

see also SBC Commc’ns, 489 F. Supp. 2d at 11 

(concluding that the 2004 amendments ‘‘effected 

minimal changes’’ to Tunney Act review). 

5 Cf. BNS, 858 F.2d at 464 (holding that the 

court’s ‘‘ultimate authority under the [APPA] is 

limited to approving or disapproving the consent 

decree’’); United States v. Gillette Co., 406 F. Supp. 

713, 716 (D. Mass. 1975) (noting that, in this way, 

the court is constrained to ‘‘look at the overall 

picture not hypercritically, nor with a microscope, 

but with an artist’s reducing glass’’); see generally 

Microsoft, 56 F.3d at 1461 (discussing whether ‘‘the 

remedies [obtained in the decree are] so 

inconsonant with the allegations charged as to fall 

outside of the ‘reaches of the public interest’ ’’). 

VII. Standard of Review Under The 

APPA For The Proposed Final 

Judgment 

The Clayton Act, as amended by the 

APPA, requires that proposed consent 

judgments in antitrust cases brought by 

the United States be subject to a sixtyday comment period, after which the 

court shall determine whether entry of 

the proposed Final Judgment ‘‘is in the 

public interest.’’ 15 U.S.C. 16(e)(1). In 

making that determination, the court, in 

accordance with the statute as amended 

in 2004, is required to consider: 

(A) The competitive impact of such 

judgment, including termination of 

alleged violations, provisions for 

enforcement and modification, duration 

of relief sought, anticipated effects of 

alternative remedies actually 

considered, whether its terms are 

ambiguous, and any other competitive 

considerations bearing upon the 

adequacy of such judgment that the 

court deems necessary to a 

determination of whether the consent 

judgment is in the public interest; and 

(B) the impact of entry of such 

judgment upon competition in the 

relevant market or markets, upon the 

public generally and individuals 

alleging specific injury from the 

violations set forth in the complaint 

including consideration of the public 

benefit, if any, to be derived from a 

determination of the issues at trial. 

15 U.S.C. 16(e)(1)(A) & (B). In 

considering these statutory factors, the 

court’s inquiry is necessarily a limited 

one as the United States is entitled to 

‘‘broad discretion to settle with the 

defendant within the reaches of the 

public interest.’’ United States v. 

Microsoft Corp., 56 F.3d 1448, 1461 (DC 

Cir. 1995); see also United States v. Alex 

Brown & Sons, Inc., 963 F. Supp. 235, 

238 (S.D.N.Y. 1997) (noting that the 

court’s role in the public interest 

determination is ‘‘limited’’ to ‘‘ensur[ing] 

that the resulting settlement is ‘within 

the reaches of the public interest’ ’’) 

(quoting Microsoft, 56 F.3d at 1460), 

aff’d sub nom. United States v. Bleznak, 

153 F.3d 16 (2d Cir. 1998); United 

States v. SBC Commc’ns, Inc., 489 F. 

Supp. 2d 1 (D. DC 2007) (assessing 

public interest standard under the 

Tunney Act); United States v. InBev 

N.V./S.A., 2009–2 Trade Cas. (CCH) 

¶76,736, 2009 U.S. Dist. LEXIS 84787, 

No. 08–1965 (JR), at *3, (D. DC Aug. 11, 

2009) (noting that the court’s review of 

a consent judgment is limited and only 

inquires ‘‘into whether the government’s 

determination that the proposed 

remedies will cure the antitrust 

violations alleged in the complaint was 

reasonable, and whether the mechanism 

to enforce the final judgment are clear 

and manageable.’’).4

As the United States Court of Appeals 

for the District of Columbia Circuit has 

held, a court considers under the APPA, 

among other things, the relationship 

between the remedy secured and the 

specific allegations set forth in the 

United States’ complaint, whether the 

decree is sufficiently clear, whether 

enforcement mechanisms are sufficient, 

and whether the decree may positively 

harm third parties. See Microsoft, 56 

F.3d at 1458–62. With respect to the 

adequacy of the relief secured by the 

decree, a court may not ‘‘engage in an 

unrestricted evaluation of what relief 

would best serve the public.’’ United 

States v. BNS, Inc., 858 F.2d 456, 462 

(9th Cir. 1988) (citing United States v. 

Bechtel Corp., 648 F.2d 660, 666 (9th 

Cir. 1981)); see also Microsoft, 56 F.3d 

at 1460–62; Alex Brown, 963 F. Supp. at 

238; United States v. Alcoa, Inc., 152 F. 

Supp. 2d 37, 40 (D. DC 2001); InBev, 

2009 U.S. Dist. LEXIS 84787, at *3. 

Courts have held that: 

[t]he balancing of competing social 

and political interests affected by a 

proposed antitrust consent decree must 

be left, in the first instance, to the 

discretion of the Attorney General. The 

court’s role in protecting the public 

interest is one of insuring that the 

government has not breached its duty to 

the public in consenting to the decree. 

The court is required to determine not 

whether a particular decree is the one 

that will best serve society, but whether 

the settlement is ‘‘within the reaches of 

the public interest.’’ More elaborate 

requirements might undermine the 

effectiveness of antitrust enforcement by 

consent decree. Bechtel, 648 F.2d at 666 

(emphasis added) (citations omitted).5

In determining whether a proposed 

settlement is in the public interest, a 

district court ‘‘must accord deference to 

the government’s predictions about the 

efficacy of its remedies, and may not 

require that the remedies perfectly 

match the alleged violations.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 17; see 

also Microsoft, 56 F.3d at 1461 (noting 

the need for courts to be ‘‘deferential to 

the government’s predictions as to the 

effect of the proposed remedies’’); Alex 

Brown, 963 F. Supp. at 239 (stating that 

the court should give ‘‘due deference to 

the Government’s evaluation of the case 

and the remedies available to it’’); 

United States v. Archer-DanielsMidland Co., 272 F. Supp. 2d 1, 6 (D. 

DC 2003) (noting that the court should 

grant due respect to the United States’ 

‘‘prediction as to the effect of proposed 

remedies, its perception of the market 

structure, and its views of the nature of 

the case’’). 

Courts have greater flexibility in 

approving proposed consent decrees 

than in crafting their own decrees 

following a finding of liability in a 

litigated matter. ‘‘[A] proposed decree 

must be approved even if it falls short 

of the remedy the court would impose 

on its own, as long as it falls within the 

range of acceptability or is ‘within the 

reaches of public interest.’ ’’ United 

States v. Am. Tel. & Tel. Co., 552 F. 

Supp. 131, 151 (D. DC 1982) (citations 

omitted) (quoting United States v. 

Gillette Co., 406 F. Supp. 713, 716 (D. 

Mass. 1975)), aff’d sub nom. Maryland 

v. United States, 460 U.S. 1001 (1983); 

see also United States v. Alcan 

Aluminum Ltd., 605 F. Supp. 619, 622 

(W.D. Ky. 1985) (approving the consent 

decree even though the court would 

have imposed a greater remedy). To 

meet this standard, the United States 

‘‘need only provide a factual basis for 

concluding that the settlements are 

reasonably adequate remedies for the 

alleged harms.’’ SBC Commc’ns, 489 F. 

Supp. 2d at 17. 

Moreover, the court’s role under the 

APPA is limited to reviewing the 

remedy in relationship to the violations 

that the United States has alleged in its 

complaint, and does not authorize the 

court to ‘‘construct [its] own 

hypothetical case and then evaluate the 

decree against that case.’’ Microsoft, 56 

F.3d at 1459; see also InBev, 2009 U.S. 

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6See United States v. Enova Corp., 107 F. Supp. 

2d 10, 17 (D. DC 2000) (noting that the ‘‘Tunney Act 

expressly allows the court to make its public 

interest determination on the basis of the 

competitive impact statement and response to 

comments alone’’); United States v. Mid-Am. 

Dairymen, Inc., 1977–1 Trade Cas. (CCH) ¶ 61,508, 

at 71,980 (W.D. Mo. 1977) (‘‘Absent a showing of 

corrupt failure of the government to discharge its 

duty, the Court, in making its public interest 

finding, should * * * carefully consider the 

explanations of the government in the competitive 

impact statement and its responses to comments in 

order to determine whether those explanations are 

reasonable under the circumstances.’’); S. Rep. No. 

93–298, 93d Cong., 1st Sess., at 6 (1973) (‘‘Where 

the public interest can be meaningfully evaluated 

simply on the basis of briefs and oral arguments, 

that is the approach that should be utilized.’’). 

Dist. LEXIS 84787, at *20 (‘‘the ‘public 

interest’ is not to be measured by 

comparing the violations alleged in the 

complaint against those the court 

believes could have, or even should 

have, been alleged’’). Because the 

‘‘court’s authority to review the decree 

depends entirely on the government’s 

exercising its prosecutorial discretion by 

bringing a case in the first place,’’ it 

follows that ‘‘the court is only 

authorized to review the decree itself,’’ 

and not to ‘‘effectively redraft the 

complaint’’ to inquire into other matters 

that the United States did not pursue. 

Microsoft, 56 F.3d at 1459–60. As the 

United States District Court for the 

District of Columbia recently confirmed 

in SBC Communications, courts ‘‘cannot 

look beyond the complaint in making 

the public interest determination unless 

the complaint is drafted so narrowly as 

to make a mockery of judicial power.’’ 

SBC Commc’ns, 489 F. Supp. 2d at 15. 

In its 2004 amendments, Congress 

made clear its intent to preserve the 

practical benefits of utilizing consent 

decrees in antitrust enforcement, adding 

the unambiguous instruction that 

‘‘[n]othing in this section shall be 

construed to require the court to 

conduct an evidentiary hearing or to 

require the court to permit anyone to 

intervene.’’ 15 U.S.C. 16(e)(2). This 

language effectuates what Congress 

intended when it enacted the Tunney 

Act in 1974. As Senator Tunney 

explained: ‘‘[t]he court is nowhere 

compelled to go to trial or to engage in 

extended proceedings which might have 

the effect of vitiating the benefits of 

prompt and less costly settlement 

through the consent decree process.’’ 

119 Cong. Rec. 24,598 (1973) (statement 

of Senator Tunney). Rather, the 

procedure for the public interest 

determination is left to the discretion of 

the court, with the recognition that the 

court’s ‘‘scope of review remains sharply 

proscribed by precedent and the nature 

of Tunney Act proceedings.’’ SBC 

Commc’ns, 489 F. Supp. 2d at 11.6

VIII. Determinative Documents 

There are no determinative materials 

or documents within the meaning of the 

APPA that were considered by the 

United States in formulating the 

proposed Final Judgment. Respectfully 

submitted, Craig W. Conrath, Michael G. 

Dashefsky, Justin M. Dempsey, Mark H. 

Hamer, Gregg I. Malawer, Bennett J. 

Matelson, Anne Newton McFadden, 

Rachel L. Zwolinski. 

Attorneys for the United States, 

United States Department of Justice, 

Antitrust Division, Litigation III, 450 

Fifth Street, NW., Suite 4000, 

Washington, DC 20530. 

Dated: October 4, 2010 

In The United States District Court For 

The Eastern District of New York 

United States of America, State of 

Connecticut, State of Iowa, State Of 

Maryland, State of Michigan, State of 

Missouri, State of Ohio, and State of 

Texas, Plaintiffs, v. American Express 

Company, American Express Travel 

Related Services Company, Inc., 

Mastercard International Incorporated, 

and Visa Inc. Defendants. 

Civil Action No. CV–10–4496 

(Garaufis, J.) 

(Pollak, M.J.) 

[Proposed] Final Judgment as to 

Defendants Mastercard International 

Incorporated and Visa Inc. 

Whereas, Plaintiffs, the United States 

of America and the States of 

Connecticut, Iowa, Maryland, Michigan, 

Missouri, Ohio, and Texas filed their 

Complaint on October 4, 2010, alleging 

that Defendants each adopted rules that 

restrain Merchants from encouraging 

consumers to use preferred payment 

forms, harming competition and 

consumers in violation of Section 1 of 

the Sherman Act, 15 U.S.C. 1, and 

Plaintiffs and Defendants MasterCard 

International Incorporated and Visa Inc., 

by their respective attorneys, have 

consented to the entry of this Final 

Judgment without trial or adjudication 

of any issue of fact or law; 

Whereas, Defendants MasterCard and 

Visa have not admitted and do not 

admit either the allegations set forth in 

the Complaint or any liability or 

wrongdoing; 

And whereas, Defendants MasterCard 

and Visa agree to be bound by the 

provisions of this Final Judgment 

pending its approval by the Court; 

Now therefore, before any testimony 

is taken, without trial or adjudication of 

any issue of fact or law, without this 

Final Judgment constituting any 

evidence against or admission by 

Defendants MasterCard or Visa 

regarding any issue of fact or law, and 

upon consent of MasterCard and Visa, it 

is ordered, adjudged and decreed: 

I. Jurisdiction 

This Court has jurisdiction over the 

subject matter of this action and over 

MasterCard and Visa. The Complaint 

states a claim upon which relief may be 

granted against MasterCard and Visa 

under Section 1 of the Sherman Act, as 

amended, 15 U.S.C. 1. 

II. Definitions 

As used in this Final Judgment: 

1. ‘‘Acquiring Bank’’ means a Person 

authorized by MasterCard or Visa to 

enter into agreements with Merchants to 

accept MasterCard’s or Visa’s General 

Purpose Cards as payment for goods or 

services. 

2. ‘‘American Express’’ means 

American Express Company, a New 

York corporation with its principal 

place of business in New York, New 

York, and American Express Travel 

Related Services Company, Inc., a 

Delaware corporation with its principal 

place of business in New York, New 

York, their successors and assigns, and 

their subsidiaries (whether partially or 

wholly owned), divisions, groups, 

affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents, and employees. 

3. ‘‘Brand’’ means the brand or mark 

of a General Purpose Card Network. 

4. ‘‘Customer’’ means a Person that 

pays for goods or services. 

5. ‘‘Department of Justice’’ means the 

United States Department of Justice, 

Antitrust Division. 

6. ‘‘Discover’’ means Discover 

Financial Services, a Delaware 

corporation with its principal place of 

business in Riverwoods, Illinois, its 

successors and assigns, and its 

subsidiaries (whether partially or 

wholly owned), divisions, groups, 

affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents, and employees. 

7. ‘‘Form of Payment’’ means cash, a 

check, a debit card, a prepaid card, or 

any other means by which Customers 

pay for goods or services, and includes 

particular brands (e.g., Star, NYCE) or 

types (e.g., PIN debit) of debit cards or 

other means of payment. 

8. ‘‘General Purpose Card’’ means a 

credit or charge card issued pursuant to 

Rules of a General Purpose Card 

Network that enables consumers to 

make purchases from unrelated 

Merchants without accessing or 

reserving funds, regardless of any other 

functions the card may have. 

9. ‘‘General Purpose Card Network’’ 

means any Person that directly or 

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indirectly assembles a group of 

unrelated Merchants to accept and a 

group of unrelated consumers to make 

purchases with General Purpose Cards 

bearing the Person’s Brand, and 

includes General Purpose Card 

Networks such as Visa, MasterCard, 

American Express, and Discover. 

10. ‘‘Issuing Bank’’ means a Person 

authorized by MasterCard or Visa to 

enter into agreements with cardholders 

for the use of that Defendant’s General 

Purpose Cards for payment at a 

Merchant. 

11. ‘‘MasterCard’’ means MasterCard 

International Incorporated, a Delaware 

corporation with its principal place of 

business in Purchase, New York, its 

successors and assigns, and its 

subsidiaries (whether partially or 

wholly owned), divisions, groups, 

affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents, and employees. 

12. ‘‘Merchant’’ means a Person that 

accepts MasterCard’s or Visa’s General 

Purpose Cards as payment for goods or 

services. 

13. ‘‘Person’’ means any natural 

person, corporation, company, 

partnership, joint venture, firm, 

association, proprietorship, agency, 

board, authority, commission, office, or 

other business or legal entity, whether 

private or governmental. 

14. ‘‘Plaintiff States’’ means the States 

of Connecticut, Iowa, Maryland, 

Michigan, Missouri, Ohio, and Texas. 

15. ‘‘Rule’’ means any rule, bylaw, 

policy, standard, guideline, or practice 

applicable to Merchants in the United 

States. 

16. ‘‘Type’’ means a category of 

General Purpose Cards, including but 

not limited to traditional cards, rewards 

cards, or premium cards (e.g., a ‘‘Visa 

Signature Card’’ or a ‘‘World 

MasterCard’’). 

17. ‘‘Visa’’ means Visa Inc., a Delaware 

corporation with its principal place of 

business in San Francisco, California, its 

successors and assigns, and its 

subsidiaries (whether partially or 

wholly owned), divisions, groups, 

affiliates, partnerships, and joint 

ventures, and their directors, officers, 

managers, agents, and employees, but 

shall not include Visa Europe Limited 

and its wholly owned affiliates. 

18. The terms ‘‘and’’ and ‘‘or’’ have 

both conjunctive and disjunctive 

meanings. 

III. Applicability 

This Final Judgment applies to 

MasterCard and Visa and all other 

Persons in active concert or 

participation with any of them who 

receive actual notice of this Final 

Judgment by personal service or 

otherwise. 

IV. Prohibited Conduct 

A. The purpose of this Section IV is 

to allow Merchants to attempt to 

influence the General Purpose Card or 

Form of Payment Customers select by 

providing choices and information in a 

competitive market. This Final 

Judgment should be interpreted to 

promote such efforts and not limit them. 

Accordingly, neither MasterCard nor 

Visa shall adopt, maintain, or enforce 

any Rule, or enter into or enforce any 

agreement that directly or indirectly 

prohibits, prevents, or restrains any 

Merchant in the United States from 

1. Offering the Customer a discount or 

rebate, including an immediate discount 

or rebate at the point of sale, if the 

Customer uses a particular Brand or 

Type of General Purpose Card, a 

particular Form of Payment, or a Brand 

or Type of General Purpose Card or a 

Form of Payment other than the General 

Purpose Card the Customer initially 

presents; 

2. offering a free or discounted 

product if the Customer uses a 

particular Brand or Type of General 

Purpose Card, a particular Form of 

Payment, or a Brand or Type of General 

Purpose Card or a Form of Payment 

other than the General Purpose Card the 

Customer initially presents; 

3. offering a free or discounted or 

enhanced service if the Customer uses a 

particular Brand or Type of General 

Purpose Card, a particular Form of 

Payment, or a Brand or Type of General 

Purpose Card or a Form of Payment 

other than the General Purpose Card the 

Customer initially presents; 

4. offering the Customer an incentive, 

encouragement, or benefit for using a 

particular Brand or Type of General 

Purpose Card, a particular Form of 

Payment, or a Brand or Type of General 

Purpose Card or a Form of Payment 

other than the General Purpose Card the 

Customer initially presents; 

5. expressing a preference for the use 

of a particular Brand or Type of General 

Purpose Card or a particular Form of 

Payment; 

6. promoting a particular Brand or 

Type of General Purpose Card or a 

particular Form or Forms of Payment 

through posted information, through the 

size, prominence, or sequencing of 

payment choices, or through other 

communications to a Customer; 

7. communicating to a Customer the 

reasonably estimated or actual costs 

incurred by the Merchant when a 

Customer uses a particular Brand or 

Type of General Purpose Card or a 

particular Form of Payment or the 

relative costs of using different Brands 

or Types of General Purpose Cards or 

different Forms of Payment; or 

8. engaging in any other practices 

substantially equivalent to the practices 

described in Sections IV.A.1 through 

IV.A.7 of this Final Judgment. 

B. Subject to compliance with the 

antitrust laws, the Dodd-Frank Wall 

Street Reform and Consumer Protection 

Act of 2010, and any other applicable 

state or federal law, nothing in this 

Final Judgment shall prohibit 

MasterCard or Visa from 

1. Enforcing existing agreements or 

entering into agreements pursuant to 

which a Merchant selects General 

Purpose Cards bearing the Defendant’s 

Brand as the only General Purpose 

Cards the Merchant will accept as 

payment for goods and services; 

2. enforcing existing agreements or 

entering into agreements pursuant to 

which a Merchant agrees that it will 

encourage Customers to use co-branded 

or affinity General Purpose Cards 

bearing both the Defendant’s Brand and 

the co-brand or affinity partner’s name, 

logo, or brand as payment for goods and 

services and will not encourage 

Customers to use General Purpose Cards 

bearing the Brand of any other General 

Purpose Card Network; 

3. enforcing existing agreements or 

entering into agreements pursuant to 

which a Merchant agrees (i) that it will 

encourage Customers, through practices 

enumerated in Sections IV.A.1 through 

IV.A.8 of this Final Judgment, to use 

General Purpose Cards bearing the 

Defendant’s Brand as payment for goods 

and services, and (ii) that it will not use 

one or more practices enumerated in 

Sections IV.A.1 thorough IV.A.8 of this 

Final Judgment to encourage Customers 

to use General Purpose Cards bearing 

any other Person’s Brand as payment for 

goods and services; provided that (a) 

any such agreement is individually 

negotiated with the Merchant and is not 

a standard agreement or part of a 

standard agreement generally offered by 

the Defendant to multiple Merchants, 

and (b) the Merchant’s acceptance of the 

Defendant’s General Purpose Cards as 

payment for goods and services is 

unrelated to and not conditioned upon 

the Merchant’s entry into any such 

agreement; 

4. adopting, maintaining, and 

enforcing Rules that prohibit Merchants 

from encouraging Customers to pay for 

goods or services using one of its 

General Purpose Cards issued by one 

particular Issuing Bank rather than by 

another of its General Purpose Cards 

issued by any other Issuing Bank. 

C. Subject to Section IV.A of this 

Final Judgment, nothing in this Final 

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Judgment shall prohibit MasterCard or 

Visa from adopting, maintaining, and 

enforcing Rules that prohibit Merchants 

from disparaging its Brand. 

D. Neither MasterCard nor Visa shall 

adopt, maintain, or enforce any Rule, or 

enter into or enforce any agreement, that 

prohibits, prevents, restrains, deters, or 

inhibits an Acquiring Bank from 

supplying a Merchant, on a transactionby-transaction or other basis, 

information regarding the costs or fees 

the Merchant would incur in accepting 

a General Purpose Card, including a 

particular Type of General Purpose 

Card, presented by the Customer as 

payment for that Customer’s transaction. 

V. Required Conduct 

A. Within five business days after 

entry of this Final Judgment, 

MasterCard and Visa shall each delete, 

discontinue, and cease to enforce in the 

United States any Rule that it would be 

prohibited from adopting, maintaining, 

or enforcing pursuant to Section IV of 

this Final Judgment. 

B. Within five business days after 

entry of this Final Judgment, Visa shall 

modify the following portion of its Visa 

International Operating Regulations 

‘‘Discount Offer—U.S. Region 5.2.D.2’’ as 

follows: 

Current language: Discount Offer— 

U.S. Region 5.2.D.2. 

In the U.S. Region, any purchase price 

advertised or otherwise disclosed by the 

Merchant must be the price associated 

with the use of a Visa Card or Visa 

Electron Card. 

A U.S. Merchant may offer a discount 

as an inducement for a Cardholder to 

use a means of payment that the 

Merchant prefers, provided that the 

discount is: 

• Clearly disclosed as a discount from 

the standard price 

• Non-discriminatory, as between a 

Cardholder who pays with a Visa Card 

and a cardholder who pays with a 

‘‘comparable card’’ 

A ‘‘comparable card’’ for purposes of 

this rule is any other branded, general 

purpose payment card that uses the 

cardholder’s signature as the primary 

means of cardholder authorization (e.g., 

MasterCard, Discover, American 

Express). Any discount made available 

to cardholders who pay with 

‘‘comparable cards’’ must also be made 

available to Cardholders who wish to 

pay with Visa Cards. Any discount 

made available to a Cardholder who 

pays with a Visa Card is not required to 

be offered to cardholders who pay with 

‘‘comparable cards.’’ 

Modified language: Discount Offer— 

U.S. Region 5.2.D.2 

A U.S. Merchant may request or 

encourage a Cardholder to use a means 

of payment other than a Visa Card or a 

Visa Card of a different product type 

(e.g., Visa Classic Card, Visa Traditional 

Rewards Card, Visa Signature Card) 

than the Visa Card the consumer 

initially presents. Except where 

prohibited by law, the Merchant may do 

so by methods that include, but are not 

limited to: 

• Offering the consumer an 

immediate discount from the 

Merchant’s list, stated, or standard 

price, a rebate, a free or discounted 

product or service, or any other 

incentive or benefit if the consumer uses 

a particular general purpose payment 

card with an acceptance brand other 

than a Visa Card or other particular 

means of payment 

• Offering the consumer an 

immediate discount from the 

Merchant’s list, stated, or standard 

price, a rebate, a free or discounted 

product or service, or any other 

incentive or benefit if the consumer, 

who initially presents a Visa Card, uses 

instead another general purpose 

payment card or another means of 

payment 

• Expressing a preference for the use 

of a particular general purpose payment 

card or means of payment 

• Promoting the use of a particular 

general purpose payment card with an 

acceptance brand other than Visa or 

means of payment through posted 

information, through the size, 

prominence, or sequencing of payment 

choices, or through other 

communications to consumers 

• Communicating to consumers the 

reasonably estimated or actual costs 

incurred by the Merchant when a 

consumer uses a particular general 

purpose payment card or means of 

payment or the relative costs of using 

different general purpose payment cards 

or means of payment. 

C. Within five business days after 

entry of this Final Judgment, 

MasterCard shall modify its MasterCard 

Rules, Rule 5.11.1 ‘‘Discrimination’’ in 

the United States as follows: 

Current language: A Merchant must 

not engage in any acceptance practice 

that discriminates against or discourages 

the use of a Card in favor of any other 

acceptance brand. 

Modified language: A Merchant may 

request or encourage a customer to use 

a payment card with an acceptance 

brand other than MasterCard or other 

form of payment or a Card of a different 

product type (e.g., traditional cards, 

premium cards, rewards cards) than the 

Card the consumer initially presents. 

Except where prohibited by law, it 

may do so by methods that include, but 

are not limited to: (a) Offering the 

customer an immediate discount from 

the Merchant’s list, stated, or standard 

price, a rebate, a free or discounted 

product or service, or any other 

incentive or benefit if the customer uses 

a particular payment card with an 

acceptance brand other than MasterCard 

or other particular form of payment; (b) 

offering the customer an immediate 

discount from the Merchant’s list, 

stated, or standard price, a rebate, a free 

or discounted product or service, or any 

other incentive or benefit if the 

customer, who initially presents a 

MasterCard, uses instead another 

payment card or another form of 

payment; (c) expressing a preference for 

the use of a particular payment card or 

form of payment; (d) promoting the use 

of a particular general purpose payment 

card with an acceptance brand other 

than MasterCard or the use of a 

particular form or forms of payment 

through posted information, through the 

size, prominence, or sequencing of 

payment choices, or through other 

communications to customers (provided 

that merchants will abide by 

MasterCard’s trademark standards 

relating to the display of its marks); or 

(e) communicating to customers the 

reasonably estimated or actual costs 

incurred by the Merchant when a 

customer uses particular payment cards 

or forms of payment or the relative costs 

of using different general purpose 

payment cards or forms of payment. 

D. Within ten business days after 

entry of this Final Judgment, 

MasterCard and Visa shall each furnish 

to the Department of Justice and the 

Plaintiff States an affidavit affirming 

that it has made the specific changes to 

its Rules required by Sections V.B (for 

Visa) and V.C (for MasterCard) of this 

Final Judgment and describing any 

additional changes, if any, it made 

pursuant to Section V.A of this Final 

Judgment. 

E. MasterCard and Visa shall each 

take the following actions to ensure that 

Merchants that accept its General 

Purpose Cards as payment for goods or 

services (i) are notified of this Final 

Judgment and the Rules changes 

MasterCard and Visa make pursuant to 

this Final Judgment; and (ii) are not 

restricted, discouraged, or prevented 

from engaging in any of the practices 

enumerated in Sections IV.A.1 through 

IV.A.8 of this Final Judgment: 

1. Within ten business days after entry 

of this Final Judgment, MasterCard and 

Visa shall each furnish to the 

Department of Justice and the Plaintiff 

States, for the approval of the 

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Department of Justice, a proposed form 

of written notification to be provided to 

Acquiring Banks for distribution to 

Merchants: 

a. describing the Rules changes each 

made pursuant to this Final Judgment; 

and 

b. informing Merchants that they are 

permitted to engage in any of the 

practices enumerated in Sections IV.A.1 

through IV.A.8 of this Final Judgment. 

Within five business days after 

receiving the approval of the 

Department of Justice, the Defendant 

shall direct its Acquiring Banks to 

furnish to each of the Merchants in the 

United States with which the Acquiring 

Banks have entered an agreement to 

accept the Defendant’s General Purpose 

Cards as payment for goods or services 

(i) a paper or electronic copy of the 

approved notification and (ii) a paper or 

electronic copy of this Final Judgment 

(or an Internet link to this Final 

Judgment). MasterCard and Visa shall 

direct the Acquiring Banks to provide 

such information in their next billing 

statement or within thirty days of their 

receipt of MasterCard’s or Visa’s 

direction, whichever is shorter. 

2. Within five business days after 

entry of this Final Judgment, 

MasterCard and Visa shall each adopt a 

Rule forbidding its Acquiring Banks 

from adopting, maintaining, or 

enforcing Rules with respect to 

MasterCard or Visa General Purpose 

Cards that the Defendant would be 

prohibited from adopting, maintaining, 

or enforcing pursuant to Section IV of 

this Final Judgment. 

F. MasterCard and Visa shall each 

notify the Department of Justice and the 

Plaintiff States, within five business 

days of such adoption or modification, 

if it adopts a new Rule that limits or 

restrains, or modifies an existing Rule in 

a manner that limits or restrains how 

Merchants accept, process, promote, or 

encourage use of Forms of Payment 

other than General Purpose Cards or of 

General Purpose Cards bearing the 

Brand of another General Purpose Card 

Network. 

VI. Compliance Inspection 

I. For purposes of determining or 

securing compliance with this Final 

Judgment, or of determining whether 

the Final Judgment should be modified 

or vacated, and subject to any legally 

recognized privilege, from time to time 

duly authorized representatives of the 

Department of Justice, including 

consultants and other persons retained 

by the Department of Justice, shall, 

upon written request of an authorized 

representative of the Assistant Attorney 

General in charge of the Antitrust 

Division, and on reasonable notice to 

MasterCard or Visa, be permitted: 

A. access during the Defendant’s 

office hours to inspect and copy, or at 

the option of the United States, to 

require the Defendant to provide to the 

United States and the Plaintiff States 

hard copy or electronic copies of, all 

books, ledgers, accounts, records, data, 

and documents in the possession, 

custody, or control of the Defendant, 

relating to any matters contained in this 

Final Judgment; and 

B. to interview, either informally or 

on the record, the Defendant’s officers, 

employees, or agents, who may have 

their individual counsel present, 

regarding such matters. The interviews 

shall be subject to the reasonable 

convenience of the interviewee and 

without restraint or interference by the 

Defendant. 

II. Upon the written request of an 

authorized representative of the 

Assistant Attorney General in charge of 

the Antitrust Division, MasterCard and/ 

or Visa shall submit written reports or 

respond to written interrogatories, 

under oath if requested, relating to any 

of the matters contained in this Final 

Judgment as may be requested. Written 

reports authorized under this paragraph 

may, at the sole discretion of the United 

States, require a Defendant to conduct, 

at its cost, an independent audit or 

analysis relating to any of the matters 

contained in this Final Judgment. 

III. No information or documents 

obtained by the means provided in this 

section shall be divulged by the United 

States to any person other than an 

authorized representative of (i) the 

executive branch of the United States or 

(ii) the Plaintiff States, except in the 

course of legal proceedings to which the 

United States is a party (including grand 

jury proceedings), or for the purpose of 

securing compliance with this Final 

Judgment, or as otherwise required by 

law. 

IV. If at the time information or 

documents are furnished by a Defendant 

to the United States and the Plaintiff 

States, the Defendant represents and 

identifies in writing the material in any 

such information or documents to 

which a claim of protection may be 

asserted under Rule 26(c)(1)(G) of the 

Federal Rules of Civil Procedure, and 

the Defendant marks each pertinent 

page of such material, ‘‘Subject to claim 

of protection under Rule 26(c)(1)(G) of 

the Federal Rules of Civil Procedure,’’ 

then the United States and Plaintiff 

States shall give the Defendant ten (10) 

calendar days notice prior to divulging 

such material in any legal proceeding 

(other than a grand jury proceeding). 

VII. Retention of Jurisdiction 

This Court retains jurisdiction to 

enable any party to this Final Judgment 

to apply to this Court at any time for 

further orders and directions as may be 

necessary or appropriate to carry out or 

construe this Final Judgment, to modify 

any of its provisions, to enforce 

compliance, and to punish violations of 

its provisions. 

VIII. No Limitation on Government 

Rights 

Nothing in this Final Judgment shall 

limit the right of the United States or of 

the Plaintiff States to investigate and 

bring actions to prevent or restrain 

violations of the antitrust laws 

concerning any Rule of MasterCard or 

Visa, including any current Rule and 

any Rule adopted in the future. 

IX. Expiration of Final Judgment 

Unless this Court grants an extension, 

this Final Judgment shall expire ten 

years from the date of its entry. 

X. Public Interest Determination 

Entry of this Final Judgment is in the 

public interest. The parties have 

complied with the requirements of the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. 16, including making copies 

available to the public of this Final 

Judgment, the Competitive Impact 

Statement, and any comments thereon 

and the United States’ responses to 

comments. Based upon the record 

before the Court, which includes the 

Competitive Impact Statement and any 

comments and response to comments 

filed with the Court, entry of this Final 

Judgment is in the public interest. 

Court approval subject to procedures 

set forth in the Antitrust Procedures and 

Penalties Act, 15 U.S.C. 16. 

Date: llllllllllllllllll

lllllllllllllllllllll

United States District Judge 

[FR Doc. 2010–25655 Filed 10–12–10; 8:45 am] 

BILLING CODE 4410–11–P 

DEPARTMENT OF LABOR 

Occupational Safety and Health 

Administration 

[Docket No. OSHA–2010–0011] 

Keystone Steel and Wire Company; 

Grant of a Permanent Variance 

AGENCY: Occupational Safety and Health 

Administration (OSHA), Department of 

Labor. 

ACTION: Notice of a grant of a permanent 

variance. 

mstockstill on DSKH9S0YB1PROD with NOTICES