The judge ruled Tuesday (June 24) that Visa’s arguments were “premature” and that the government can proceed with its claim, Bloomberg reported Tuesday.
At this stage in the process, the judge can only decide whether the government’s claims are plausible, not whether they are true, according to the report.
Visa will have another chance to seek dismissal of the case when the pretrial evidence gathering is complete, per the report.
The Justice Department filed its antitrust lawsuit against Visa in September, alleging that the company employed exclusionary contracts and anticompetitive practices to maintain its market share dominance in the debit card market, resulting in higher fees for merchants and consumers, PYMNTS reported at the time.
The lawsuit alleged that Visa enters contracts with merchants and acquirers that effectively require them to route all or nearly all eligible debit transactions through its network, uses “cliff pricing” structures that impose penalties on merchants and acquirers if they fail to meet volume commitments to Visa, discourages issuers from enabling competing networks on Visa-branded debit cards and pays potential competitors not to develop alternative debit products.
Visa General Counsel Julie Rottenberg told PYMNTS in September that the lawsuit is “meritless.”
“Anyone who has bought something online, or checked out at a store, knows there is an ever-expanding universe of companies offering new ways to pay for goods and services,” Rottenberg said on the day the lawsuit was filed. “Today’s lawsuit ignores the reality that Visa is just one of many competitors in a debit space that is growing, with entrants who are thriving.”
“When businesses and consumers choose Visa, it is because of our secure and reliable network, world-class fraud protection, and the value we provide,” Rottenberg added.
PYMNTS CEO Karen Webster wrote in October about the DOJ debit interchange lawsuit: “The real problem for challengers to Visa in the U.S., and other card networks, is that payments work so well for consumers. In the end, it’s innovation — and consumers — that will decide how people pay and with whom.”
