VISA: Honor All Cards rule doesn't prevent merchant influence

ARLINGTON, Va. – With the court drawing closer to unsealing the documents involved in the fight with Wal-Mart and other retailers, Visa officials told the American Banker that nothing about the Honor All Cards rule prevented Wal-Mart or the other retailers from influencing customers to use cards with a lower interchange rate. Visa officials said that the association had argued before Judge John Gleeson of the U.S. District Court for the Eastern District of New York that Wal-Mart’s argument does not meet the legal requirements for anti-trust since the associations’ “Honor All Cards” rules do not prevent merchants from accepting or even steering customers to PIN-based debit. The officials also said the company had argued that the growth of EFT networks undermines the plaintiffs’ claims of debit monopolization, and that the plaintiffs’ formula for calculating damages is illogical, because it looks only at the price of offline debit transactions and excludes other cost implications. All parties’ summary judgment briefs have been under seal since they were filed in June 2000. On Tuesday, Judge Mann issued an order giving the parties until Friday to take a last look at the docket before the unsealing begins, the paper reported.