Is new lawsuit a case of déjà vu?

Mastercard and Visa are facing new allegations of price fixing in a lawsuit filed by three small New York merchants. The lawsuit, filed on April 21, 2026, in U.S. District Court for the Southern District of New York, accuses the card companies of anticompetitive practices that force businesses to pay excessive processing fees to accept credit cards, in violation of federal antitrust laws.

They also take issue with numerous Visa and Mastercard rules and prohibitions, including:

• The "honor all cards" rules;

• Prohibitions around surcharging;

• No competing marks rules (for example, cards that contain the marks for Visa and Discover, thereby allowing transactions to be processed through either network);

• All outlets rules, which require merchants to accept Visa- or Mastercard-branded credit cards at all locations operating under the same banner;

• No bypass rules, which prohibit the bypassing of Visa or Mastercard for less expensive means of authorizing, clearing or settling transactions on alternative networks.

Prior case still unsettled

The lawsuit comes as District Judge Brian Cogan, in U.S. District Court for the Eastern District of New York, considers a proposed settlement in the Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, a case first filed in October 2005 by a large class of merchants against Visa and Mastercard.

The new case makes many of the same allegations addressed in that settlement, under which Mastercard and Visa agreed to dispense with their honor all cards rules, as well as to temporarily lower interchange fees and pony up $21 million for a merchant education program on payment acceptance and cost management.

However, it is uncertain whether that proposed settlement agreement will be approved by Judge Cogan, who took over the case in 2025. Several large retailers, including Walmart, are opposed to the settlement, as are leading retail trade associations, including the National Retail Federation and the National Grocers Association.

Three merchants look for class action, Visa seeks funds

The complainants in the latest lawsuit—two restaurants in the suburbs of New York City and a hair salon on Manhattan's Upper East Side—argue that another antitrust suit settlement, entered into in 2019, only applied to damages suffered through January 2019. Several large merchant chains—including Amtrak, Dick's Sporting Goods and Nike—that withdrew from that settlement have settled separately with the card companies in recent weeks.

The latest lawsuit seeks class action status on behalf of all merchants that have accepted Visa and Mastercard credit cards in the United States since Jan. 25, 2019.

"In effect, Visa and Mastercard sought to purchase through settlement a license to continue violating the antitrust laws – immunizing themselves from damages claim while they continued their same course of harmful action," the new lawsuit alleges. "Merchants have continued to suffer harm as Visa and Mastercard have maintained the same anticompetitive practices that existed in the earlier class action – practices that helped generate more than $700 billion in fees since the close of the last class period on January 24, 2019."

Meanwhile, Visa announced on April 13 a share exchange program for its Class B shares to help cover costs incurred defending against merchant lawsuits. Class B shares are those held primarily by financial institutions and their holding companies. Many of those shares were doled out when Visa went from being an entity owned by financial institutions to a free-standing publicly-traded corporation.

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