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Ohio v. Am. Express Co.

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Ohio v. Am. Express Co.can Express Ct. 2274 (2018) (2018)
Case Ohio v. Am. Express Co.

Case Summary:

Case Name: Ohio v. American Express Co.
Citation: 585 U.S. ___ (2018)
Date Decided: June 25, 2018
Court: Supreme Court of the United States
Issue: Whether American Express’ anti-steering provisions, which prohibited merchants from offering discounts or incentives to customers to use cards from other issuers with lower transaction fees, violated Section 1 of the Sherman Act’s prohibition on unreasonable restraints of trade.

Majority Opinion:

The Court, in a 5-4 decision, sided with American Express, finding that the anti-steering provisions did not violate antitrust law.
The Court applied the “rule of reason” test, which requires plaintiffs to show that the challenged conduct has an anticompetitive effect on the relevant market.
The Court defined the relevant market as the two-sided market for credit card transactions, encompassing both merchants and cardholders.
The Court concluded that the plaintiffs failed to prove that the anti-steering provisions harmed competition in the relevant market.
The Court noted that Visa and MasterCard had similar anti-steering provisions, and that merchant fees had continued to increase even after those companies rescinded their provisions.

Dissenting Opinion:

Justice Sotomayor, joined by Justices Ginsburg, Kagan, and Breyer, dissented.
They argued that the majority’s analysis was flawed and that the anti-steering provisions clearly harmed competition by raising merchant fees and reducing consumer choice.
They also argued that the Court incorrectly defined the relevant market and should have focused on the market for merchants facing high transaction fees.

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