NACS, et al. v. FRS, No. 13-5270 (D.C. Cir. 2014)Annotate this Case
Congress passed the Durbin Amendment as part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376, which modified the Electric Funds Transfer Act (EFTA), Pub. L. No. 96-630, 92 Stat. 3641. At issue were two key provisions of the EFTA: section 920(a), which restricted the amount of the interchange fee and section 920(b), which prohibited certain exclusivity and routing priority agreements. Merchant groups challenged the Board's issuance of regulations imposing a cap on the per-transaction fees banks received (section 920(a)) and, in an effort to force networks to compete for merchants' business, requiring that at least two networks owned and operated by different companies be able to process transactions on each debit card (section 920(b)). Merchant groups sought lower fees and even more network competition. The court applied traditional tools of statutory interpretation and held that the Board's rules generally rest on reasonable constructions of the statute. The court remanded one minor issue regarding the treatment of so-called transactions-monitoring costs to the Board for further explanation. Accordingly, the court reversed the district court's grant of summary judgment to the merchants and remanded for further proceedings.