First Data Corp. has broken ranks with Visa and banks in the escalating interchange war. The card-processing giant formally objected to the $7.25 interchange settlement last Friday (May 24), saying the fact that it accepted credit cards in its cafeteria would make it a "merchant" under the settlement and prevent First Data from protecting itself against unfair dealings by the card brands. Bottom line: First Data wants the settlement changed, which could open the door to the whole deal unraveling.
Also on Friday, Visa and MasterCard sued a group of merchants and trade groups who have opted out of the settlement—but that's less impressive than it looks. The card brands' suit is a mirror image of the lawsuit that Target and 16 other retail chains filed last Thursday (May 23), which claimed the card brands' entire rule structure violates antitrust laws. The card brands are asking a court to declare that its rules don't violate antitrust laws.