A U.S. District Court judge on April 10 dismissed litigation accusing three leading card issuers of colluding to require cardholders to enter into arbitration to settle disputes instead of class-action litigation.
Cardholders in the case failed to show that American Express, Citigroup and Discover Financial Services violated the Sherman Antitrust law by adopting the arbitration clauses in their cardholder agreements, Judge William Pauley ruled.
The case, which has gone on for about a decade, alleged that the defendants conspired in establishing the clauses between May 1999 and October 2003, when 10 card-issuing banks and their lawyers met 28 times to discuss how to impose mandatory arbitration clauses, according to Reuters.
In her 92-page decision, Pauley said his decision was a close call. “It was only by a slender reed that plaintiffs failed to demonstrate that the lawyers who organized these meetings had spawned a Sherman Act conspiracy among their clients," the judge wrote.
Plaintiffs lawyers reportedly were considering an appeal.
In January 2011, the Supreme Court ruled that consumers who sign credit card contracts containing an arbitration clause cannot dispute charges in court.
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