A San Diego pizzeria has filed a 134-page proposed class action lawsuit against Visa, Mastercard, and five of the nation's largest banks — Bank of America, Capital One, Chase Bank, Citibank, and Wells Fargo — alleging a decades-long conspiracy to artificially inflate credit card interchange fees. The suit frames these fees as "a deadweight toll on virtually every credit card purchase in America," totaling over $100 billion annually in what plaintiffs call "monopoly rents." The core mechanism is structural, not incidental. Visa and Mastercard set uniform interchange fee schedules that issuing banks charge merchants on every transaction. These fees are, in practice, non-negotiable. The lawsuit alleges the defendants have built a "web of anticompetitive rules" that disable every market force that might otherwise discipline pricing — merchants who accept any Visa or Mastercard must accept all of them regardless of cost, eliminating incentive for issuing banks to compete on fees. The restraints go further. Merchants are allegedly prevented from steering customers toward lower-cost payment options — for instance, by surcharging customers who use high-fee cards. The effect, the complaint argues, is a system where issuing banks face no competitive pressure from each other and alternative card networks are locked out. Visa and Mastercard themselves then layer on their own network fees — per-transaction charges and fixed fees — adding what the suit calls "an additional supracompetitive tax" on top of the already inflated interchange. This is not the first time this exact mechanism has been litigated. A prior multidistrict class action resulted in a settlement of over $5 billion in December 2019, but that relief covered only transactions through January 24, 2019. A separate equitable-relief settlement seeking injunctive changes has been preliminarily approved but provides no monetary compensation for post-2019 fees. The new lawsuit targets the gap: merchants who accepted Visa and Mastercard after January 2019 have, the suit alleges, "borne the full brunt of Defendants' continuing anticompetitive conduct" with no remedy. The filing seeks to represent all individuals, businesses, and entities that accepted Visa-branded and/or Mastercard-branded credit cards in the United States from January 25, 2019 until the alleged anticompetitive effects cease. The proposed class is enormous — effectively every merchant in the country. What makes this case structurally important is not the dollar figure but the claimed permanence of the extraction mechanism. If the allegations hold, the defendants have designed a system where fees can only go up: no merchant-side negotiation, no competitive entry, no customer-level price signals, and prior settlements that address past injury but leave the structural restraints intact. The $5 billion settlement resolved claims; it did not dismantle the machine. The question is whether litigation can do what competition has not. The prior settlement's structure — monetary relief for past periods, prospective rule changes but no compensation going forward — suggests the card networks have learned to settle in ways that preserve the fee architecture. If this pattern repeats, interchange fees will continue to function as a private tax on American commerce, passed through to consumers in higher prices, with the benefits concentrated in a handful of financial institutions.
