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Media Alerts - Osborn v. Visa - D.C. Circuit
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August 4, 2015
  Osborn v. Visa - D.C. Circuit
Headline: D.C. Circuit allows antitrust claims involving ATM fees to proceed

Area of Law: Antitrust

Issue(s) Presented:
Whether agreements that prevent ATM networks from charging different prices based on network costs violate section 1 of the Sherman Antitrust Act.

Brief Summary: Appellants, users and operators of ATM networks that are not associated with banks, brought suit against Visa, MasterCard, and affiliated banks, claiming that the agreement that allows independent ATM operators access to the Visa and MasterCard networks is anti-competitive. The agreement contains rules that prohibit ATM operators from charging customers higher access fees for transactions processed over Visa and MasterCard networks than for transactions processed over other networks, even though Visa and MasterCard charge operators more to access their networks than their competitors do. The U.S. District Court for the District of Columbia dismissed the cases without prejudice, concluding that the plaintiffs had failed to demonstrate standing and had failed to allege an agreement in restraint of trade cognizable under the Sherman Antitrust Act. Plaintiffs' subsequent motions to modify their complaints were denied on the grounds that the revised complaints still lacked sufficient facts to demonstrate a cognizable injury or to establish the existence of a conspiracy.

The U.S. Court of Appeals for the District of Columbia Circuit reversed. The court rejected Appellees' arguments that the claimed injury was too speculative to support standing, finding that Appellants' claim of economic harm - that the access fee rules prevented independent ATM operators from charging less for transactions over lower cost networks, thus insulating Visa and MasterCard from competition and allowing them to charge supra-competitive prices, resulting in higher charges to individual ATM card users - was a "classic form of injury-in-fact" that relied on provable facts and well-established economic principles "routinely credited by courts in a variety of contexts."

The court also held that Appellants had adequately pleaded a Sherman Act conspiracy. Appellees argued that the access fee rules did not constitute an anti-competitive agreement between Visa and MasterCard because they had been adopted separately by the two entities. However, the court found that Appellants' allegations that the rules had been agreed to by a group of retail banks that controlled Visa and MasterCard for the purpose of charging supra-competitive fees was sufficient to support a finding of concerted activity. The court also determined that the fact that Visa and MasterCard had later been reorganized as public corporations did not conclusively establish that they had withdrawn from the agreement, when Appellees alleged evidence that both had continued to abide by the access fee rules.

For the full text of the opinion, please visit

Panel (if known): Tatel, Srinivasan, Wilkins

Argument Date (if known): February 20, 2015

Date of Issued Opinion: August 4, 2015

Docket Number: 14-7004

Decided: Reversed

Case Alert Author:
Ripple Weistling

Counsel (if known): Steve W. Berman, Craig L. Briskin, Michael G. McLellan, Douglas G. Thompson, Brooks E. Harlow, and Don A. Resnikoff for Appellants.

Kenneth A. Gallo, Mark R. Merley, Matthew A. Eisenstein, Mark P. Ladner, Michael B. Miller, William F. Cavanaugh, and Peter E. Greene for Appellees.

Author of Opinion: Wilkins

Case Alert Circuit Supervisor: Elizabeth Beske, Ripple Weistling

Edited: 08/04/2015 at 01:45 PM by Ripple Weistling

    Posted By: Ripple Weistling @ 08/04/2015 01:12 PM     DC Circuit  

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