Less than a week after suing, Disney settled an antitrust lawsuit against Visa and Mastercard on Wednesday accusing the credit card companies of charging bloated processing fees.
According to a court document, Disney moved to dismiss the suit. Terms of the deal weren’t disclosed.
The suit revolved around interchange fees, which credit card companies charge for every transaction to cover costs associated with processing and authorizing payments. Merchants have long argued that Visa and Mastercard’s hold on the market allows them to price-fix those fees, which ultimately leads to higher prices for customers.
“Visa and MasterCard and their members have obtained and maintained market power in the market for merchant acceptance of credit cards and the market for merchant acceptance of debit cards in the United States,” writes Sanford Litvack, representing Disney, in the complaint. “The exercise of this market power has led merchants to pay excessive interchange and network fees, injuring both Plaintiff and consumers (including cardholders) through higher costs and decreased consumer welfare.”
The two companies account for over 80 percent of all debit purchases, according to the complaint.
Disney sued after opting out of a $6 billion settlement, which included an agreement to reduce the charge to process transactions for eight months, in a nearly identical class action lawsuit filed by retailers against Visa, Mastercard and major banks. Other large retailers also chose not to participate in the deal to get a better terms for themselves. In February, Amazon resolved a months-long standoff with Visa over interchange fees that threatened to bar customers from using Visa credit cards across the online retailer’s websites.
Disney and its attorneys declined to comment. Visa and Mastercard didn’t respond to requests for comment.