240 Million dollar law suit filed against Visa,MasterCard and First Financial
August 14, 2004 (Press Release) --
PSW, INC.
c/o Sinapi, Formisano & Company, Ltd.
100 Midway Place, Suite 1
Cranston, Rhode Island o2920
NEWS RELEASE
FOR RELEASE ON: Monday, August 16, 2004
FOR MORE INFORMATION, CONTACT: Richard A. Sinapi, Esq. (401) 944-9690
(e-mail copy of complaint available upon request)
PSW, INC. FILES ANTITRUST LAWSUIT AGAINST MASTERCARD AND VISA
Providence—PSW, Inc., a credit card processing company for internet merchants, filed a lawsuit today in federal district court against MasterCard and Visa alleging violations of various state and federal anti-trust laws and seeking over $240 million in damages. Also named as defendants in the lawsuit are First Financial Bank and First Data Merchant Services, both of which are owned by Colorado based First Data Corporation. The twelve-count complaint also alleges claims for interference with contractual relations, breach of the covenant of good faith and fair dealing, conversion, embezzlement, and breach of contract.
The lawsuit is filed in the wake of an estimated $3.5 billion dollar settlement agreed to by MasterCard and Visa in an anti-trust lawsuit spearheaded by Wal-Mart and the decision by a federal court in 2001 in an action brought by the Justice Department in the case of United States v. Visa, wherein MasterCard and Visa were found to have conspired to unreasonably restrain competition in the markets for credit cards and credit card processing in violation of federal anti-trust laws.
The complaint alleges that the defendants used monopoly power to employ policies and practices that unreasonably excluded competition and restrained trade in the credit card and credit card processing markets, which was not outweighed by any countervailing pro-competitive effects. PSW alleges that as a result of this conduct, it was forced to pay higher prices for network services, pay excessive fees, fines and penalties, and comply with unknown, continuously changing, and commercially unreasonable rules and directives of the defendants, at significant expense. As a consequence, PSW claims that the defendants’ usurped PSW’s profits and good will and forced it out of business.
The conduct complained of by PSW includes agreements which courts have held in the past to constitute violations of federal anti-trust law, including horizontal concerted refusals to deal, price-fixing, geographic market divisions, and price discrimination. PSW also claims that in light of the court decision in United States v. Visa, federal anti-trust law prohibits MasterCard and Visa from disputing PSW’s contention that they unreasonably restrained trade and excluded competition. The only thing left for the court to decide is whether PSW was hurt by the anti-competitive conduct and, if so, the amount of damages it sustained.
c/o Sinapi, Formisano & Company, Ltd.
100 Midway Place, Suite 1
Cranston, Rhode Island o2920
NEWS RELEASE
FOR RELEASE ON: Monday, August 16, 2004
FOR MORE INFORMATION, CONTACT: Richard A. Sinapi, Esq. (401) 944-9690
(e-mail copy of complaint available upon request)
PSW, INC. FILES ANTITRUST LAWSUIT AGAINST MASTERCARD AND VISA
Providence—PSW, Inc., a credit card processing company for internet merchants, filed a lawsuit today in federal district court against MasterCard and Visa alleging violations of various state and federal anti-trust laws and seeking over $240 million in damages. Also named as defendants in the lawsuit are First Financial Bank and First Data Merchant Services, both of which are owned by Colorado based First Data Corporation. The twelve-count complaint also alleges claims for interference with contractual relations, breach of the covenant of good faith and fair dealing, conversion, embezzlement, and breach of contract.
The lawsuit is filed in the wake of an estimated $3.5 billion dollar settlement agreed to by MasterCard and Visa in an anti-trust lawsuit spearheaded by Wal-Mart and the decision by a federal court in 2001 in an action brought by the Justice Department in the case of United States v. Visa, wherein MasterCard and Visa were found to have conspired to unreasonably restrain competition in the markets for credit cards and credit card processing in violation of federal anti-trust laws.
The complaint alleges that the defendants used monopoly power to employ policies and practices that unreasonably excluded competition and restrained trade in the credit card and credit card processing markets, which was not outweighed by any countervailing pro-competitive effects. PSW alleges that as a result of this conduct, it was forced to pay higher prices for network services, pay excessive fees, fines and penalties, and comply with unknown, continuously changing, and commercially unreasonable rules and directives of the defendants, at significant expense. As a consequence, PSW claims that the defendants’ usurped PSW’s profits and good will and forced it out of business.
The conduct complained of by PSW includes agreements which courts have held in the past to constitute violations of federal anti-trust law, including horizontal concerted refusals to deal, price-fixing, geographic market divisions, and price discrimination. PSW also claims that in light of the court decision in United States v. Visa, federal anti-trust law prohibits MasterCard and Visa from disputing PSW’s contention that they unreasonably restrained trade and excluded competition. The only thing left for the court to decide is whether PSW was hurt by the anti-competitive conduct and, if so, the amount of damages it sustained.
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