Court decision opens market for credit cards

NEW YORK — Visa USA Inc. and MasterCard International Inc. can no longer block their partner banks from issuing cards from other competitors after the Supreme Court on Monday let stand a lower court ruling that found the practice anticompetitive.

The decision opens up competition to Discover Financial Services Inc. and American Express Co. in both credit card and debit card issuance, which could push down interest rates charged to consumers. Discover also sued the two top card issuers for damages allegedly incurred by their practices shortly after the high court decision was released.

In the Supreme Court case, the Bush administration argued in court filings that removing the restriction on banks issuing MasterCard and Visa cards would encourage competition and lead to more choices and, possibly, lower interest rates for consumers.

The administration had won in district court and the New York-based 2nd U.S. Circuit Court of Appeals, which found the restriction was anticompetitive.

About 20,000 banks issue cards only through Visa and MasterCard.

Both Discover and American Express offer their cards directly to consumers via direct mail, the Internet and a variety of marketing programs. American Express has partnered with overseas banks to issue cards, with limited success.

•.The Supreme Court turned away a challenge Monday to the federal do-not-call registry, ending telemarketers’ bid to invoke free-speech arguments to get the ban on unwanted phone solicitations thrown out.

The court, without comment, let stand a 10th U.S. Circuit Court of Appeals decision that upheld the registry of more than 64 million phone numbers as a reasonable government attempt to safeguard personal privacy and reduce telemarketing abuse.

Under the 2003 federal law, businesses face fines of up to $11,000 if they call people who sign up for the registry — unless they have recently done business with them. Charities, pollsters and callers on behalf of politicians, however, are exempt.

Telemarketing groups had filed the appeal, arguing in filings that the registry violated First Amendment rights because it singled businesses out while exempting other groups. They also said 2 million of their 6.5 million workers will lose their jobs within two years if the do-not-call rules stand.