NEW YORK – American Express Co. agreed to pay as much as $75 million and alter some of its merchant rules to settle two class-action suits alleging its policies have driven up the costs retailers pay to accept its credit and charge cards, the Wall Street Journal reports.

Reacting to the settlement, the Merchants Payments Coalition, of which NACS is a founding member, says that the settlement will hurt customers and merchants.

“This agreement is a tragic mistake that will hurt merchants and their customers,” MPC Chairman and National Retail Federation Senior Vice President and General Counsel Mallory Duncan said. “The settlement does nothing to lower credit card swipe fees while making sure the fees will continue to be hidden from consumers and that the big credit card companies can continue to fix prices without competition. The result is that swipe fees will continue to be the fastest-growing expense for merchants and that consumers will keep paying overinflated fees without even knowing it.”

AMEX outlined the terms of the agreement, which still requires court approval, in a press release: 

• Merchants continue to agree that if they decide to surcharge their customers using credit or charge cards, any surcharge on American Express Card transactions would be no more than the surcharge on credit or charge card products issued on competing networks.
• Similarly, merchants agree that if they surcharge customers paying with prepaid or debit cards, they would not surcharge American Express prepaid cards more than any competing prepaid or debit cards issued on competing networks.
• Merchants would be allowed to surcharge charge and credit cards, even if they do not surcharge prepaid and debit card transactions.
• Merchants would agree not to pursue further legal challenges to American Express’ Non-Discrimination and Honor All Cards Provisions for at least 10 years after these changes are implemented.
• American Express would agree to pay reasonable attorneys fees for both cases up to a maximum total of $75 million, as approved by the Court.
• If merchants choose to pursue individual lawsuits or arbitrations for alleged damages relating to the Non-Discrimination and Honor All Cards Provisions, they would agree that any potential recovery would be limited to damages for the period prior to the implementation of the changes.

If the settlement terms are approved by the Court, all merchants who accept American Express cards in the United States will be bound by the changes to American Express’ Non-Discrimination and Honor All Cards Provisions and by the agreement not to make any future claims relating to these contract provisions for a period of at least 10 years after the changes are implemented.