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Ten named plaintiffs yesterday officially filed their objections to a proposed settlement of the interchange fee lawsuit against MasterCard and Visa, saying that the settlement "locks in the broken interchange system rather than imposing meaningful reforms to it."

The plaintiffs included the National Grocers Association (NGA); three of its members, Coborn's Inc., D'Agostino Supermarkets, and Affiliated Foods Midwest; Jetro Holdings, Inc. and Jetro Cash & Carry Enterprises; and five other national associations on behalf of their members - the National Association of Convenience Stores, National Community Pharmacists Association, National Cooperative Grocers Association, National Restaurant Association, NATSO (travel plazas and truck stops).

In addition, the plaintiffs said they have been joined in their objections by some 1200 other entities, including the American Booksellers Association, National Association of College Stores, National Retail Federation, and the Retailer Industry Leaders Association.

The $6 billion settlement proposal is objected to on the grounds that it, as currently constructed, will do little to stop the indiscriminate rise of swipe fees, which hurts both retailers and shoppers, while at the same time preventing future legal challenges to the credit/debit card companies. Those who favor it appear to do so on the grounds that they believe it is the best deal they can get.

"We were and still are all committed to achieving reform of an anti-competitive interchange fee system and rules in order to provide competition, transparency and fairness in the swipe fee marketplace," says NGA CEO Peter Larkin, adding that NGA is not motivated by monetary damages, but by the need for "reform of the collusive establishment of interchange fees and enforcement of anti-competitive rules by the credit card companies and banks that unfairly restrict merchants' freedom to operate."

The proposed settlement has been submitted to the US District Court for the Eastern District of New York.
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