MasterCard Sued for Antitrust Violations & Fraud

rand · 05-12-2003

For Immediate Release

May 12, 2003

MasterCard Sued for Antitrust Violations & Fraud

MARINA DEL REY, CA. Paycom Billing Services, Inc., an Internet Payment Service Provider, processing credit card and check transactions for Internet merchants, filed a multi-million dollar lawsuit today in Federal Court in Los Angeles against MasterCard International for antitrust violations, fraud and other issues.

Paycom's suit alleges that MasterCard has established monopolistic rules that allow it unreasonable discretion to dominate Internet merchants, and it has exercised this power to illegally impose fines and penalties in the millions of dollars.

Former Federal Prosecutors for the US Department of Justice, William McD. Miller and Richard P. Crane, Jr. of the Los Angeles law firm Musick, Peeler & Garrett LLP and Dennis M. P. Ehling, filed the lawsuit on behalf of the Plaintiff. Mr. Crane stated, "A United States Federal District Court has already determined that MasterCard is a monopoly. MasterCard's continued unfair dealings and the imposition of baseless fines, penalties and fees on Internet merchants, such as Paycom, simply prove the abusive control that one finds in a monopoly."

Paycom's Chief Executive Officer, Christopher Mallick, commented "We are in compliance with MasterCard's rules as a merchant, yet they fine us millions of dollars. Paycom has been directed to change its entire business structure, indeed to change the way in which E-commerce works, to comply with additional rules from MasterCard; rules that MasterCard cannot or will not articulate or explain." Mallick added, "These rules are unreasonable and demonstrate MasterCard's intent to continue to economically bully Internet merchants. Paycom has a responsibility to our employees and our clients. The intent of this lawsuit is to force MasterCard to treat us and other Internet merchants fairly and to permit us to operate as any other merchant class. This is a business that we built on our ability to accept MasterCard, one of the only currencies available for online shoppers."

The litigation alleges MasterCard violated several Federal and California State laws including violations of Federal and California State anti-trust laws, denial of fair procedures, unfair competition, fraud, breach of contract and breach of implied covenants of good faith and fair dealing, intentional interference with Paycom's contractual relationships, and intentional and negligent interference with Paycom's prospective business advantage, and seeks damages, declaratory and injunctive relief.

Paycom's lawsuit may be found at http://www.paycom.net/mastercard/lawsuit.pdf
All inquiries should be directed to:
Dennis M. P. Ehling, Esq.
Musick, Peeler & Garrett, LLP
Telephone: 213-629-7600 or by email: d.ehling@mpglaw.com

05-12-2003	#1
rand Members Join Date: Nov 2002 Location: Marina del Rey Posts: 91	For Immediate Release May 12, 2003 MasterCard Sued for Antitrust Violations & Fraud MARINA DEL REY, CA. Paycom Billing Services, Inc., an Internet Payment Service Provider, processing credit card and check transactions for Internet merchants, filed a multi-million dollar lawsuit today in Federal Court in Los Angeles against MasterCard International for antitrust violations, fraud and other issues. Paycom's suit alleges that MasterCard has established monopolistic rules that allow it unreasonable discretion to dominate Internet merchants, and it has exercised this power to illegally impose fines and penalties in the millions of dollars. Former Federal Prosecutors for the US Department of Justice, William McD. Miller and Richard P. Crane, Jr. of the Los Angeles law firm Musick, Peeler & Garrett LLP and Dennis M. P. Ehling, filed the lawsuit on behalf of the Plaintiff. Mr. Crane stated, "A United States Federal District Court has already determined that MasterCard is a monopoly. MasterCard's continued unfair dealings and the imposition of baseless fines, penalties and fees on Internet merchants, such as Paycom, simply prove the abusive control that one finds in a monopoly." Paycom's Chief Executive Officer, Christopher Mallick, commented "We are in compliance with MasterCard's rules as a merchant, yet they fine us millions of dollars. Paycom has been directed to change its entire business structure, indeed to change the way in which E-commerce works, to comply with additional rules from MasterCard; rules that MasterCard cannot or will not articulate or explain." Mallick added, "These rules are unreasonable and demonstrate MasterCard's intent to continue to economically bully Internet merchants. Paycom has a responsibility to our employees and our clients. The intent of this lawsuit is to force MasterCard to treat us and other Internet merchants fairly and to permit us to operate as any other merchant class. This is a business that we built on our ability to accept MasterCard, one of the only currencies available for online shoppers." The litigation alleges MasterCard violated several Federal and California State laws including violations of Federal and California State anti-trust laws, denial of fair procedures, unfair competition, fraud, breach of contract and breach of implied covenants of good faith and fair dealing, intentional interference with Paycom's contractual relationships, and intentional and negligent interference with Paycom's prospective business advantage, and seeks damages, declaratory and injunctive relief. Paycom's lawsuit may be found at http://www.paycom.net/mastercard/lawsuit.pdf All inquiries should be directed to: Dennis M. P. Ehling, Esq. Musick, Peeler & Garrett, LLP Telephone: 213-629-7600 or by email: d.ehling@mpglaw.com __________________ --Rand Epoch Paycom Paycom EU