This week two antitrust class action lawsuits were filed by Marchbanks Truck Service, Inc. and Universal Delaware, Inc. on behalf of a proposed class of all independent truck stops challenging a variety of illegal conduct allegedly engaged in by Comdata, owner of the monopoly credit card system used by practically every truck stop in the United States. The lawsuits filed in federal court in Philadelphia charge that Comdata has harmed competition by using its market dominance to impair the ability of rival card issuers to challenge Comdata’s monopoly.
“Comdata’s practices have cost independent truck stops millions of dollars in excessive fees, have prevented truck stops from using more efficient and less costly forms of payment, and ultimately have hurt consumers,” said David Balto one of the attorneys in the case.
Comdata is based in Brentwood, Tennessee and is a subsidiary of Minneapolis-based Ceridian Corporation. Ceridian has also been named in the suit, which alleges that in the mid-1990s Comdata acquired its chief truck stop card rival (NTS) and the monopoly point of sale system (Trendar). After becoming a monopolist in the truck stop card and point of sale system markets, Comdata changed its pricing system and significantly increased card fees paid by independent truck stops relative to fees charged to the chain truck stops.
Chain truck stops (such as Pilot, Petro, and Travel Centers of America) typically pay about 50 cents a transaction. Independent truck stops pay a percentage of the value of the transactions, typically over 2%. Given that the vast majority of affected transactions, which usually involve truckers buying large quantities of diesel fuel, are far in excess of $25, the card fee independents pay is almost always significantly greater than the 50 cent fee chain truck stops pay. The difference in charges costs independent truck stops millions of dollars annually, impedes competition by independent truck stops and ultimately leads to all consumers paying more.
“Comdata’s conduct threatens the independent truck stop marketplace,” said Mr. Balto. “Among other concerns, Comdata’s pricing scheme has placed independent truck stops, typically family-owned, at a substantial disadvantage to the chain truck stops.”
The lawsuits seek treble damages for the overcharges to the plaintiffs and the proposed class of independent truck stops, and an injunction to prevent the ongoing anticompetitive conduct.
Plaintiffs are also represented by Eric L. Cramer of the Philadelphia law firm of Berger & Montague, P.C. and Joseph Saveri of the San Francisco law firm of Lieff, Cabraser, Heimann & Bernstein, LLP.
Truck stop owners that wish to learn more about this litigation or contact plaintiffs’ counsel to report their experiences should visit www.lieffcabraser.com/comdatasuit.htm