Apple, Mastercard, and Visa convince judge to dismiss collusion lawsuit

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A federal judge has dismissed the current version of a lawsuit that accused Apple, Visa, and Mastercard of colluding to keep payment processing fees artificially high for merchants. Still, the fight isn’t definitively over.

The case, filed in 2023 by Mirage Wine & Spirits and other businesses, claimed that Apple profited from anticompetitive agreements that discouraged it from launching a rival payment network to compete with Visa and Mastercard.

From the original lawsuit:

“In exchange for agreeing not to compete with Visa and Mastercard in the Relevant Market, the two card networks offered Apple a very large and ongoing cash bribe. They agreed to pay Apple 15 basis points (i.e., 0.15%) on the value of all U.S. credit transactions and 0.5 cents ($0.005) on all U.S. debit transactions initiated with Apple Pay at the POS on their respective networks. Even as Apple Pay was in its infancy, the Entrenched Networks and Apple understood that this bribe would amount to hundreds of millions of dollars per year.”

On Wednesday, however, U.S. District Judge David Dugan said the plaintiffs simply didn’t bring enough to the table.

In his ruling, he noted the lawsuit relied mostly on “a slew of circumstantial allegations” that were ”too speculative and conclusory to adequately represent parallel conduct,” and failed to show that Apple ever had concrete plans to go head-to-head with the card giants in the payments infrastructure space in the first place.

30 days to try again

Still, the judge did leave the door open for another round, as merchants have 30 days to amend their complaint and try again:

“As requested, Plaintiffs shall file a Second Amended Class Action Complaint, if any, within 30 days. Failing to timely file a Second Amended Class Action Complaint will result in a dismissal of the case under Federal Rule of Civil Procedure 41(b).”

As reported by Reuters, Apple hasn’t commented on the ruling. Mastercard declined to respond, and Visa didn’t immediately reply to requests for comment. All three companies have denied any wrongdoing.