A multibillion-dollar class-action lawsuit against fees that credit card companies charge to merchants has been given the go-ahead by B.C.'s Supreme Court.
The lawsuit filed by Mary Watson, owner of Vancouver-based furniture company Metropolitan Home, was certified March 26 and alleges banks and credit card companies are engaged in a civil conspiracy forcing merchants to accept all types of credit cards.
The suit claims premium credit cards carry with them higher processing fees paid by retailers, leaving merchants less money after the final sale.
Watson’s lawyers said the case centres on the $5 billion in annual fees merchants pay to accept Visa and MasterCard transactions.
A dozen institutions were named in the suit, including Visa, MasterCard, BMO Financial Group, Royal Bank of Canada and Toronto-Dominion Bank.
Similar claims have been put forward in Alberta, Ontario, Quebec and Saskatchewan.
"The claims advanced in the other jurisdictions are very similar and were designed to collectively capture the claims of all Canadian merchants," says Watson’s lawyer, Reidar Mogerman.
“We hope that this positive decision will result in the Canadian banks, Visa and Mastercard responding to merchants' concerns about how high these fees are set.”
Changes have already occurred in many other countries to address this problem, and we believe it is time for Canada's banks to respond as well."
The defendants have not yet filed a response to the case.
A similar lawsuit was settled in New York last December for $7 billion.
