web posted June 19, 2000
Justice Department takes on Visa, MasterCard
The Justice Department started its suit against credit card giants Visa and MasterCard in federal court June 12, claiming the two companies are really one monopolistic entity.
Of the nearly 500 million credit cards in circulation in the United States, about 75 percent of them carry the Visa or MasterCard logo.
The Justice Department's antitrust lawsuit contends that the two companies are operating what is known as a "duality," in which the approximately 7,000 banks that operate both associations engage in collusion, stifling competition and limiting consumer choices.
"This is essentially a battle for the control of the American payment system," said Lloyd Constantine, a New York lawyer who is representing 4 million retailers, including WalMart, the Limited, and Sears Roebuck, in a separate class-action lawsuit against the two companies.
"If the Justice Department's case fails, all payments -- not just plastic payments -- but recurring payments, utilities, everything, will be taxed by a cartel known by two names: Visa and MasterCard," Constantine said.
In the case being heard by District Court Judge Barbara Jones, Justice Department lawyers will try to show that there is little or no competition between Visa and MasterCard, and that the two have adopted rules and policies that restrict member banks from doing business with other credit card companies like American Express and Discover.
The chairman and CEO of American Express testified on the matter before a Senate committee in May.
"The penalty for any bank that decides to issue cards on the Discover or American Express networks is severe," Harvey Golub said May 25. "Visa and MasterCard rules are clear. They will throw banks out of their network, thus having the effect that banks must exit the retail banking business."
Lawyers for Visa and MasterCard disagree that the competition is stifled."There are thousands of different card products, some are offered with low interest rates, some are offered with no fees, some are offered with a cash rebate," said MasterCard lawyer Kevin Arquit.
The federal complaint says the same large banks control both associations, by "simultaneously serving on the board of directors of one, and on important committees of the other... (which) has substantially lessened competition between Visa and MasterCard because these banks have been, and continue to be... less willing to fund and implement competitive initiatives that would cause consumers to switch their business from one association to the other."
Such practices limit consumer choice and stifle innovation, the complaint says.
"If the Justice case wins, there will be lower interest rates, more product offerings, and more innovation for consumers," Constantine said.
"One big issue now is Internet security for credit cards, but rather than try to make it safer, they (Visa and MasterCard) are stifling new advances in that area."He cited Canada's market for debit cards and stored-value, or pre-paid, cards which is "years ahead of the U.S. in terms of technology."
"(Visa and MasterCard's) rules marginalize American Express and Discover/Novus in the credit card market, ousts them from the debit card market, and ousts them from the stored-value market," he said.
Constantine predicted the case could take eight to 10 weeks to play out.
His class-action suit will go to court in November. That case also claims monopolistic abuses, but differs from the Justice Department case in that retailers are suing because Visa and MasterCard force them to pay for debit card transactions at the same rate as credit card purchases, even though debit card purchases carry less risk of non-payment.
$50 000 Canadian grant to examine strippers
Canada's federal government is spending $50 000 on a study of the history of erotic entertainment in Vancouver.
The three-year project is being funded by the Social Sciences and Humanities Research Council of Canada.
Garth Williams, a council spokesman, said: "Only the best projects are funded."
The federal agency gives out about $90-million annually, and each proposal is reviewed by a peer committee in an "extremely competitive" process, he said.
The study is being carried out at the University of British Columbia. Professor Becki Ross is interviewing erotic dancers to gain a better understanding of what she says is a "little understood, much maligned" business.
"I see it as an art form."
Ross, who teaches sociology at UBC, said: "I actually am in awe of the women on the stage."
Ross said she is looking for people who worked in the stripping industry from 1945 to 1980 to interview as part of her study. She is planning to produce a book and documentary that she says will break down the stereotypes of the industry.
"It's absolutely something to be proud of," she said.
Others are less impressed. "I'm almost speechless," said Mark Milke, a spokesman for the Canadian Taxpayers' Federation.
"What, strippers don't get 'studied' enough every day as it is?"
Last year, it was revealed the federal cultural agencies helped fund the erotic movie Bubbles Galore. About $120 000 in public money was spent on the film.
Ladies and gentleman are history, says college
The word "history" should be consigned to the past, according to managers at a British college who deem it sexist.
"Ladies" and "gentlemen" are also frowned on because of their associations with social class. "Mad," "crazy" and "manic" have been ruled out as derogatory to people with mental health problems.
The examples come from a list of more than 40 potentially offensive words compiled at Manchester's Stockport College in northwest England as part of an "equal opportunities awareness" course for the staff.
The list was gleefully used by several British newspapers on June 12 to poke fun at so-called political correctness.
Among the other words and phrases highlighted were "taking the mickey," a British colloquialism for making fun of somebody which was said to be anti-Irish, and "slaving over a hot stove," which was deemed to minimise the horror of slavery.
"Manmade" and "man in the street" were ruled potentially sexist and "Mrs" was said to be found offensive by some. "Normal couple" is likewise a no-no, with the guide asking: "What's normal?"
"Nitty gritty" was also listed because it is said to originate from the slave trade.
Microsoft request denied
The judge overseeing the Microsoft antitrust case ruled on June 13 that it is too early to consider Microsoft's request to delay his breakup order because the software company has not yet filed an appeal.
"Consideration of a stay pending appeal is premature in that no notice of appeal has yet been filed," wrote U.S. District Judge Thomas Penfield Jackson in an order filed in Washington, D.C.
Jackson, who the week before ordered Microsoft to be broken into two smaller companies to prevent it from violating state and federal antitrust laws in the future, said the court reserved ruling on the motion until a proper appeal is submitted.
Jackson's ruling also imposed restrictions on Microsoft's conduct that would be in effect as the case moves through the appeals process.
Immediately after the court's breakup ruling, the world's largest software maker asked Judge Jackson to delay the implementation of his ruling until an appellate court hears its case, saying the ruling's provisions would "inflict grievous and irreparable harm on the company."
Many speculate that Microsoft wants its appeal to be heard by the federal Court of Appeals, where it has received favorable decisions in previous antitrust matters filed by the government, as opposed to the government's desire to move the process to the U.S. Supreme Court as quickly as possible.
Attorney picked to present Clinton disbarment case
Attorney Marie-Bernarde Miller will represent the state panel that disciplines lawyers in its disbarment petition in circuit court in Little Rock.
Miller said June 13 that she was hired June 7 but referred all other questions about the case to the state Supreme Court Committee on Professional Conduct.
The committee recommended May 22 that Clinton be stripped of his license to practice law in Arkansas over misleading testimony in the Paula Jones sexual harassment case about his relationship with Monica Lewinsky.
Clinton has said the committee was treating him more severely than other lawyers.
The committee has not yet filed its petition with the court.
Miller, 48, grew up in Little Rock. She graduated from Maryville College in St. Louis and received a law degree from the University of Kansas in 1984. A former social studies teacher, Miller works for a Little Rock law firm.
Last fall, Miller presented the case against the first Arkansas judge removed from office for misconduct.
Texas gun case tests scope of Second Amendment
The Second Amendment to the U.S. Constitution says: "A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed."
The courts have never clearly decided whether it guarantees an individual's right to possess a gun, or whether it really applies, in this day and age to the National Guard, the descendant of the "well regulated militia."
Now, the Fifth Circuit Court of Appeals is considering U.S. v. Emerson, a Texas case that could decide the question.
A lower court ruled that a federal law that took away husband Timothy Joe Emerson's gun in a bitter divorce case was unconstitutional because it violated the Second Amendment, an individual's right to own a gun. Federal law makes it a crime for a person to possess a firearm while under a court restraining order.
The three-judge appeals court panel repeatedly questioned whether the issue belonged in their court.
Alarmed gun control advocates argued that if the lower court's decision were upheld, many of the nation's gun laws would be overturned.
"If the individuals' rights views were to prevail generally, it would fundamentally alter the constitutional standards under which gun laws are judged," said Dennis Henigan of Handgun Control, Inc., a group that advocates gun control.
Pro-gun attorneys insist that a ruling favorable to their side would not eliminate gun control, but would certainly limit it.
"I think everybody realizes the stakes are very high," said gun rights attorney Stephen Halbrook.
If the Supreme Court ultimately decides the case, it would be the first definitive ruling on the scope of the Second Amendment, even though it has been in the Constitution since 1791.
Elian's U.S. kin file new appeal for asylum hearing
Lawyers for Elian Gonzalez's Miami relatives said June 15 they have filed an appeal in federal court in their bid to keep the 6-year-old Cuban boy in the United States.
The attorneys announced at a news conference in Miami that they would seek a rehearing of their case before all 12 judges of the 11th U.S. Circuit Court of Appeals in Atlanta.
A three-judge panel ruled against them June 1, saying the Immigration and Naturalization Service acted within reason when it decided that only Elian's father -- not the Miami relatives -- could apply for asylum on Elian's behalf.
The unanimous ruling blocked Elian from leaving the country immediately and gave his Miami relatives two weeks to appeal -- either to the full appeals court or the U.S. Supreme Court. That deadline expired on the 15th.
If the appeal is accepted, the court will decide whether the original three judges will rehear the case or if all 12 judges must do so. If the full complement of judges decides to hear the case, they will grant what is called an "en banc" hearing.
Kendall Coffey, one of the attorneys for the Miami relatives, said the three-judge panel erred because a recent Supreme Court case -- Christensen vs. Harris County -- limits discretion of federal agencies.
"The 11th Circuit made it clear they would not have decided this case in the same way but they had to stand back to the INS' discretion," said Coffey.
He said based on the new Supreme Court ruling, "There are now grave questions about giving deference to that kind of discretion."
The second major issue, said Coffey, is that other appeals courts around the country have issued rulings that aliens do have "due process rights" under U.S. law.
Extending "due process" to Elian would have allowed the child to have an asylum hearing, he contended.
"If this child had come ashore in Mississippi, he would have had his asylum hearing by now, " said Coffey, because the 5th U.S. Circuit Court of Appeals in New Orleans has ruled aliens have that right.
"These issues need to be presented to the entire court," said Coffey.
Lawyers for Elian's great-uncle, Lazaro Gonzalez, could have gone directly to the U.S. Supreme Court. However, those familiar with the case say the Supreme Court usually prefers a lower court to review any new issue raised on appeal.
The Miami relatives' appeal to the 11th Circuit does not take away their right to file further appeals with the Supreme Court. The family's lawyers have said repeatedly that they will take the case to the nation's highest court.
A Washington law firm, Kirkand and Ellis, has joined the legal team representing the Miami relatives and filed the appeal via Federal Express.
"According to the lawyers, that makes it an official filing," said Miami family spokesman Armando Gutierrez.
Legal experts have said that unless the Miami relatives get another temporary injunction barring the boy's removal from the United States, Juan Miguel Gonzalez, the father of Elian, will be free to return to Cuba with his son by the end of this month.
They have also predicted that the Supreme Court will not take the case because there is no disagreement at the lower court level over the point of the law.
"The law is crystal clear here. The Supreme Court is not going to really be happy about having to get involved in this case simply to put Cuba on trial," said Washington immigration attorney Jose Pertierra, himself of Cuban descent. "In other words, they are not going to be used politically here; they are smarter than that."
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