August 7, 2017
Authored by: Bryan Cave, Vanessa Fulton, Stanton Koppel and Seyi Iwarere
State laws that prohibit retailers from charging customers a surcharge for using a credit card are being challenged on First Amendment grounds.
For more than four decades, California’s Song-Beverly Credit Card Act of 1971 prohibited retailers from charging credit card customers such a surcharge. In Italian Colors Restaurant, et al. v. Harris, 99 F.Supp.3d 1199 (E.D. Cal. 2015), a federal judge ruled that the law unconstitutionally limits retailers’ freedom of speech. The California attorney general appealed, and the case is set for oral argument before the Ninth Circuit Court of Appeals on August 17.
The outcome may be influenced by the U.S. Supreme Court’s decision in March of this year in Expressions Hair Design v. Schneiderman, 137 S. Ct. 1144 (2017), that a similar New York ban on credit card surcharges implicates the First Amendment. That case has been remanded to the Second Circuit to determine whether the ban