Amex Faces State Pressure over Anti-Steering Case as DOJ Backs Off
The U.S. Justice Department may have dropped its antitrust suit against American Express, but 11 states want to press on in a case that started in 2010. At issue is the company’s push to prevent Amex-accepting merchants from offering shoppers financial incentives to use other card brands.
On Friday, June 2, the DOJ said it would not ask the U.S. Supreme Court to review the federal government’s case against Amex, a move that enables the payment brand to maintain the practice. “We believe the DOJ’s decision not to proceed sends a strong signal that this seven-year litigation should come to an end,” Amex said.
Eleven states, however, filed a petition on Friday asking the Supreme Court to review the case. Those states are: Connecticut, Idaho, Illinois, Iowa, Maryland, Michigan, Montana, Ohio, Rhode Island, Utah and Vermont.
In 2010, the DOJ filed an antitrust lawsuit against American Express, Visa and Mastercard over the networks’ anti-steering rules. Visa and Mastercard quickly settled, agreeing to remove such rules from its contacts with merchants. However, American Express opted to challenge the suit, claiming anti-steering provisions promote competition by enabling its cards to compete with the other networks, which together have more than 1 billion cards in circulation in the U.S., compared with American Express’ 55 million. Amex scored a major legal victory on Sept. 26 when a federal appeals court ruled that Amex had the right to restrict retailers.