NASM Files Brief in Texas Credit Card Suit

VICTORIA, Texas — The National Association of Shell Marketers (NASM) filed a friend of the court brief in a legal battle taking place in a Victoria County courtroom that could affect the class-action settlement in a swipe fee case involving retailers and Visa Inc. and MasterCard Inc.

NASM filed a friend of the court brief, also known as an amicus curiae, in Speedy Stop Food Stores Inc. et al. v. Visa Inc. et al. in the District Court of Victoria County in last week.

According to NASM, the case centers around four branded petroleum marketers that opted out of the nationwide Visa-MasterCard class-action settlement in New York. The marketers filed a separate lawsuit against Visa and MasterCard alleging antitrust claims similar to those asserted by the plaintiff class members in the New York class action.

However, Visa and MasterCard asked the Texas court to dismiss the case based on their contention that branded petroleum retailers have no standing to assert such antitrust claims because they supposedly do not pay directly the credit card interchange fees — or swipe fees — that are deducted from the proceeds of credit card transactions at branded retail locations, NASM explained.

Visa and MasterCard have made the same argument in the New York class action that they have raised in the Texas case.

NASM's brief supports the Texas marketers' position that they do pay such interchange fees directly and, therefore, have standing in their antitrust claims against Visa and MasterCard concerning those fees.

"NASM has a direct and significant interest in this case. Its members, and the service station dealers supplied by them, engage in the retail sale of convenience store items and Shell-branded motor fuels to consumers," the association stated in the brief. "The overwhelming majority of such sales involve credit card transactions. The fees associated with those credit card transactions are deducted from the sales proceeds received by the retailers that operate the service stations and are, thus, paid by them."

The case raises the question of whether branded retailers will ultimately be able to receive any portion of the proceeds that are to be distributed in the settlement in the New York Visa-MasterCard class-action lawsuit.

"Only the branded convenience store owner/operators and gasoline retail facilities pay the fees and costs of credit card transaction including the interchange fee. These fees and costs are paid directly to the bank. No other party pays these interchange fees. Accordingly, owners/operators have standing pursue a private remedy," NASM stated in the brief.

According to NASM, the association filed the brief because a "ruling by the Texas state court could possibly set an important precedent on this issue."

Garrisonville, Va.-based NASM is a national trade association representing approximately 170 wholesale distributors of Shell-branded petroleum products, together with 65 suppliers of goods and services to the petroleum industry.