MARYLAND ENACTS LEGISLATION REGULATING DEBT MANAGEMENT SERVICES

On Tuesday, May 20, 2003, three electronic commerce companies, eGeneral Medical Inc., Howell Automotive and Direct Foreign Exchange PLC, filed a suit in federal court in North Carolina, against Visa U.S.A. Inc., MasterCard International Inc., American Express Co. and Morgan Stanley’s Discover Financial Services Inc. It has been reported that they are seeking class action status.

The plaintiffs want credit card companies to be required to inform online, phone-based and direct-mail merchants if a customer’s credit card has been stolen or compromised or if there is a history of fraud because merchants are required to pay the credit card companies’ transactional and penalty fees for the fraud, which they cannot recover.

The lawsuit seeks actual and punitive damages, but does not provide a dollar figure.

Mike Tomkies and Deborah Freye