A New York federal judge on Wednesday refused to dismiss claims
against Discover Bank and Citigroup Inc. in the multidistrict
litigation claiming credit card issuers conspired to insert
anti-competitive arbitration clauses in their customer
In awarding summary judgment to the plaintiffs, U.S. District
Judge Willam H. Pauley rejected the credit companies' argument that
certain evidence relating to a settlement in a similar MDL should
not be permitted.
They had argued that the release in the settlement of In re:
Currency Conversion Fee Antitrust Litigation limited the evidence
on which the plaintiffs rely, specifically evidence related to
certain foreign transaction fee conduct. But Judge Pauley said
Citigroup had misread the agreement.
Citigroup and Discover are the only two remaining defendants in
the litigation, in which the plaintiffs claim the defendants'
compulsory arbitration clauses prevented cardholders from seeking
proper legal recourse for the companies' anti-competitive conduct
and corporate misconduct.
The cardholders have argued the arbitration clauses would shield
the defendants' misconduct from public view, as arbitration
proceedings are often held privately and the outcomes are often
confidential, adding that arbitration administrators are sometimes
partial to credit card companies.
View the full article