Document ID: ./input/supremecourt_opinions/opinions/23pdf/22-1008_1b82.pdf
Page Number: 7.0

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CORNER POST, INC. v. BOARD OF GOVERNORS, FRS 

Opinion of the Court 

the banks of merchants and cardholders.  The cost quickly 
adds up.  Since it opened, Corner Post has paid hundreds of 
thousands of dollars in interchange fees—which has meant 
higher prices for its customers. 

Interchange  fees  have  long  been  a  sore  point  for  mer-
chants.  For many years, payment networks had free rein 
over the fee amount—and because they used the promise of 
per-transaction  profit  to  compete  for  the  banks’  business,
they  had  significant  incentive  to  raise  the  fees.  Mer-
chants—who  would  lose  customers  if  they  declined  debit
cards—had little choice but to pay whatever the networks 
charged.  Left unregulated, interchange fees ballooned. 

Congress eventually stepped in.  The Durbin Amendment 
to the Dodd-Frank Wall Street Reform and Consumer Pro-
tection Act  of 2010 tasks the Federal Reserve Board with 
setting “standards for assessing whether the amount of any 
interchange  transaction  fee  . . .  is  reasonable  and  propor-
tional to the cost incurred by the issuer with respect to the 
transaction.”  124 Stat. 2068, 15 U. S. C. §1693o–2(a)(3)(A).
Discharging this duty, the Board promulgated Regulation
II,  which  sets  a  maximum  interchange  fee  of  $0.21  per
transaction plus .05% of the transaction’s value.  See Debit 
Card  Interchange  Fees  and  Routing,  76  Fed.  Reg.  43394, 
43420  (2011).    The  Board  published  the  rule  on  July  20, 
2011. 

Four months later, a group of retail-industry trade asso-
ciations  and  individual  retailers  sued  the  Board,  arguing 
that  Regulation  II  allows  costs  that  the  statute  does  not. 
See NACS v. Board of Governors of FRS, 958 F. Supp. 2d 
85, 95–96 (DC 2013).  The District Court agreed, id., at 99– 
109,  but  the  D. C.  Circuit  reversed,  concluding  “that  the 
Board’s rules generally rest on reasonable constructions of 
the statute,” NACS v. Board of Governors of FRS, 746 F. 3d 
474, 477 (2014).

Corner  Post,  of  course,  did  not  exist  when  the  Board