Antitrust Law Daily Wrap Up, ANTITRUST—E.D.N.Y.: Consumer class action challenging Amex merchant agreement set for trial in July, (May 14, 2025)

By Martin A. Steinberg, J.D.

Among rulings on seven motions in limine, court held that evidence of Class Representatives' relationships with counsel may be probative of their bias.

In a consumer antitrust class action against American Express and American Express Travel Related Services (together “Amex”), the federal district court in Brooklyn, New York, decided seven motions in limine filed by the parties. Previously, the court granted the Plaintiffs' motion for class certification for the state debit card classes and denied it to the state credit card classes. Under state antitrust and consumer protection laws, the Plaintiffs challenge the non-discrimination provisions that Amex imposed on merchants that accept Amex cards as payment. The trial is scheduled to begin on July 28, 2025 (Quinton v. American Express Co., No. 1:19-cv-00566-NGG-JRC (E.D.N.Y. May 13, 2025)).

Background. On January 29, 2019, the Plaintiffs filed a class action suit alleging that Amex violated the Sherman and Clayton Antitrust Acts, various state antitrust and consumer protection statutes, and unjust enrichment. They alleged that Amex's Non-Discrimination Provisions (NDPs or "Anti-Steering Rules") unreasonably restrained trade in the two-sided market for general purpose credit and charge card transactions by: (1) increasing transaction prices to supra-competitive levels; (2) reducing the number of credit card transactions; and (3) raising consumer retail prices on goods and services.

The Plaintiffs alleged that Amex's NDPs act as a vertical non-price restraint on trade in violation of state antitrust and consumer protection laws. Amex is a bank that operates a payment network for general-purpose credit and charge cards. Unlike non-bank network competitors Visa and Mastercard, Amex operates a closed loop. It directly interacts with consumers by issuing cards and merchants by contracting with them to accept Amex cards as a payment method.

In its contracts with merchants, Amex universally includes NDPs that restrict what merchants can communicate to consumers at the point of sale. Among other restraints, the NDPs prohibit merchants that accept Amex cards from stating a preference for one network over another, disclosing the fee the merchant pays for each payment network, or differentially surcharging based on the merchant's cost of processing the payment. The Plaintiffs alleged that the NDPs act as an unlawful restraint on trade because they shield Amex from competition to the detriment of non-Amex-cardholding consumers.

On April 30, 2020, the court dismissed the Plaintiffs' federal antitrust and unjust enrichment claims and their antitrust and/or consumer protection claims under the laws of five states. Subsequently, the court granted in part Amex's motion for judgment on the pleadings, dismissing the Plaintiffs' antitrust claims under the laws of 13 additional states and consumer protection claims under the laws of two states. Claims under the laws of 14 jurisdictions remain.

Plaintiffs’ motions.

The Plaintiffs moved in limine to preclude (1) evidence or argument concerning the absence of the Plaintiffs during trial; (2) cumulative expert testimony; (3) specific third-party publications; and (4) evidence or testimony concerning the Class Representatives' adequacy.

Absence of Plaintiffs during the trial. First, the Plaintiffs requested that Amex be precluded from offering evidence or argument concerning the absence of the Class Representative Plaintiffs or other Plaintiffs during the trial pursuant to FRE Rules 401, 402, and 403. The parties' respective submissions demonstrated no dispute on this issue. Amex does not intend to comment on the presence or absence of Plaintiffs during trial, and the Class Representative Plaintiffs plan to testify in person at trial. As such, the Plaintiffs' first motion in limine was denied without prejudice to renewal should Amex retreat from its current position at trial.

Expert testimony. Second, the Plaintiffs sought to bar Amex from introducing cumulative expert testimony at trial under FRE 403. Amex's Trial Witness List provides that Amex will call three expert witnesses at trial: Dr. B. Douglas Bemheim, who will testify to procompetitive justifications of Amex's NDPs; Dr. Eric Emch, who will testify to competitive effects; and Dr. Eric M. Gaier, who will testify to injury, causation, and damages. The court, however, refused to preclude the anticipated testimony of these witnesses at this time because it is unknown whether the overlap in their reports, if any, will materialize in their testimony at trial. Furthermore, the Plaintiffs' requested relief was vague and overly broad. Ultimately, suppose Amex wishes to present three witnesses' opinions that could be offered in one. In that case, that would be its prerogative (within the time limits agreed upon by the parties in their joint pretrial submission). However, the court would not allow needlessly cumulative testimony at trial, especially from experts. As such, while the court was prepared to preclude needlessly cumulative expert testimony at trial, it was unclear what that testimony will entail.

Third-party publications. Third, the Plaintiffs sought to preclude Amex from using 123 documents with their experts on direct examination, including: 13 third-party publications that were not previously disclosed as a source relied upon by Amex's experts in forming their previously disclosed opinions; and 110 articles that on their face cannot qualify as learned treatises under Rule 803(18). The court granted this motion in part and denied it in part without prejudice to renewal. FRCP 26 provides that a testifying expert must file a report containing, among other things, "a complete statement of all opinions the witness will express and the basis and reasons for them," and "the facts or data considered by the witness in forming” the opinions. Suppose a party failed to provide information as FRCP 26(a) or (e) required. In that case, the party cannot use that information or witness to supply evidence on a motion, at a hearing, or a trial, unless the failure was substantially justified or is harmless.

It was undisputed that Amex's experts did not disclose 10 of the 13 objected-to documents as relied upon or considered authoritative. Thus, Amex cannot use that information to supply evidence at a trial unless the failure to disclose was substantially justified or is harmless. Fed. R. Civ. P. 37(c)(1). The court noted that Amex's failure to disclose these documents was not substantially justified. Nor was Amex's failure to disclose these documents harmless.

Regarding the 110 documents, the court refused to preclude them at this time because the Plaintiffs' motion was premature. A court should exclude evidence on a motion in limine only when the evidence is clearly inadmissible on all potential grounds. Even accepting the Plaintiffs' argument that these documents do not fall within the learned treatise exception to the rule against hearsay, the Plaintiffs presume that FRE 803(18) (A) is the only avenue through which Amex may seek to admit these documents, or that Amex intends to offer these documents for the truth of the matters asserted therein. The court would not exclude them entirely because the Plaintiffs did not demonstrate that these documents are clearly inadmissible on all potential grounds.

Class representatives' adequacy. Finally, the Plaintiffs requested an order excluding "documents, live and/or designated testimony, and argument relating to issues going to the Class Representatives' adequacy." Specifically, the Plaintiffs seek to preclude evidence concerning the Class Representatives': (a) knowledge of antitrust law and the claims asserted; (b) relationship to counsel; (c) circumstances of retaining counsel; and (d) agreement with counsel on attorneys' fees and costs. While the Plaintiffs were correct that the class representative's adequacy is not a fact of consequence in determining liability or damages, they were incorrect that the broadly phrased categories of evidence pertain only to the issue of class adequacy, according to the court. Instead, as Amex pointed out, the evidence may go to other relevant issues, such as the Class Representatives' bias.

First, the court denied the Plaintiffs' request to exclude all evidence concerning the Class Representatives' "knowledge of antitrust law and the claims asserted" as overly vague. Second, the court found that evidence of the Class Representatives' personal relationships with counsel is admissible for impeachment purposes. The Class Representatives' relationships with counsel are probative of their bias because they might lead them to slant, unconsciously or otherwise, their testimony in favor of or against a party. For example, the fact that Abigail Baker is the class counsel's niece might cause Baker to slant her testimony in favor of the Plaintiffs and against Amex, perhaps out of fear that her uncle may begrudge her for providing unhelpful testimony, or out of a desire to achieve a positive result for her uncle.

Third, unlike their personal relationships with counsel, the circumstances surrounding the Class Representatives' retention of counsel are irrelevant to the issue of bias. Thus, the Plaintiffs' request to exclude all evidence concerning the circumstances surrounding the Class Representatives' retention of counsel was granted. Fourth, the court granted the Plaintiffs' request to exclude all evidence concerning the Class Representatives' agreement with counsel on attorneys' fees and costs because the Plaintiffs' retainer agreements and fee arrangements do not tend to make a fact of consequence in determining the action more or less probable. And even if such evidence bore some probative value, which it does not, its probative value would be substantially outweighed by a danger of unfair prejudice and confusing the issues.

Amex’s motions.

Amex moved in limine to preclude (1) testimony and exhibits from United States v. Am. Express Co., No. 10-CV-4496 (NGG) (RER) (E.D.N.Y.) (the "DOJ Action"); (2) any evidence of damages purportedly suffered by a class of Plaintiffs from Alabama before January 29, 2017, as barred by the applicable statute of limitations; and (3) testimony of Amex's in-house counsel, Katherine Currie.

The DOJ Action. Amex sought to preclude particular testimony and exhibits from the bench trial in the DOJ Action, which took place in July and August of 2014, pursuant to FRE 402, 403, and 802. Amex argued that the testimony and exhibits from the DOJ Action are irrelevant because they are over a decade old and "the competitive landscape for electronic payments has changed drastically in the last 15-20 years." The court considered each basis for preclusion and concluded that the questionable probative value of this evidence was substantially outweighed by a danger of unfair prejudice, confusing the issues, and wasting time.

Alabama class. Second, Amex sought to preclude evidence of damages suffered by the certified class of Plaintiffs from Alabama (the "Alabama Class") before January 29, 2017, on the ground that the applicable statute of limitations bars such evidence. Because the statute of limitations for antitrust claims under Alabama law is two years, any damages estimate for the Alabama Class, which includes transactions before January 29, 2017, should be barred. The court agreed with the Plaintiffs that Amex's motion was procedurally improper, for it is well settled that a motion in limine "is not the proper vehicle for seeking a dispositive ruling on a claim." While Amex framed its request as a motion in limine, in reality, Amex seeks a dispositive ruling on its statute of limitations defense. Such a maneuver is procedurally improper.

Amex in-house counsel. Finally, Amex requested an order precluding the Plaintiffs from calling an Amex in-house counsel, Katherine Currie, as a witness at trial. According to Amex, the Plaintiffs plan to solicit Ms. Currie's testimony regarding Amex's response to the Plaintiffs' first interrogatory, where the Plaintiffs asked Amex to describe “in detail how you determine the Discount Fee you charge, and Discount Rate you apply to merchants in the United States to accept your Credit and Charge cards." Amex contended that its response to that question does not require testimony from Ms. Currie.

On the one hand, Ms. Currie's role in this proceeding appears to weigh against permitting her testimony. According to Amex, Ms. Currie "has served as a member of Amex's in-house legal department since this litigation's inception and has actively participated in Amex's representation in this litigation." On the other hand, Ms. Currie's role in the subject as to which her testimony is sought is unique: she is the only person who can testify as to the bases for Amex's interrogatory responses. While the bases for Amex's interrogatory responses are a proper examination subject, the risk of encountering privileged information cannot be discounted.

The court concluded that the flexible, non-exhaustive Friedman factors supported a narrowly circumscribed examination of Ms. Currie. See In re Subpoena Issued to Dennis Friedman, 350 F.3d 65, 70 (2d Cir. 2003). In that case, the Second Circuit observed, in dicta, that courts faced with a request to depose opposing counsel should adopt a "flexible approach" that considers "all of the relevant facts and circumstances to determine whether the proposed deposition would entail an inappropriate burden or hardship." Such considerations may include: (1) the need to depose the lawyer, (2) the lawyer's role in connection with the matter on which discovery is sought and to the pending litigation, (3) the risk of encountering privilege and work-product issues, and (4) the extent discovery was already conducted.

Amex sought to insulate the bases for its interrogatory responses from scrutiny, even though Amex chose to have its in-house counsel sign those responses. If other nonlawyers possess the same substantive knowledge as Ms. Currie, one non-lawyer should have verified Amex's responses. But the court would not preclude the Plaintiffs from examining Ms. Currie about the bases for interrogatory responses that she, and she alone, verified. Thus, Ms. Currie may testify regarding (1) the information provided to and relied upon by her, whether through communications with individuals or review of documents, in answering the interrogatories; (2) the particular source of that information; and (3) non-privileged communications between Ms. Currie and her human sources about said information that occurred in the course of investigating and answering the interrogatories.

The Case is No. 1:19-cv-00566-NGG-JRC.

Judge: Garaufis, N.

Attorneys: Daniel Cohen (Cuneo Gilbert & LaDuca, LLP) for Terry Gayle Quinton. Peter T. Barbur (Cravath, Swaine & Moore LLP) for American Express Co.

Companies: American Express Co.

Cases: Antitrust StateUnfairTradePractices NewYorkNews GCNNews