Heartland Payment filed a federal lawsuit against Mercury Payment Systems for false advertising, unfair competition, intentional interference with contractual relations, and intentional interference with prospective economic advantage. The suit alleges that Mercury is illegally competing against Heartland with deceptive trade practices and that Mercury is effectively misleading merchant customers by deceptively hiding its excess profits in the interchange fees charged by credit card networks and their issuing banks, in violation of the Lanham Act.
The suit seeks to stop Mercury’s routine deceptive pricing practices to secure new retail customers and maintain their existing merchants. The suit also seeks to recover full value for each merchant and prospect Mercury has wrongfully taken from Heartland by deceptively falsifying pass-through interchange costs and other illegal methods. Heartland explains that the fees charged by credit and debit card issuers – the issuing banks plus card brands such as Visa and MasterCard – are collectively known as network, or interchange, fees. Interchange fees are set by the card brands, and are typically adjusted twice a year. The complaint also alleges that Mercury imposes significant costs and barriers for changing providers, falsely informs merchants that they are the only processor that supports their point-of-sale card swiping equipment, and falsely represents their company in commercial advertising and promotions as guaranteeing the best rate, among other charges.