State attorneys general from across the nation joined retailers earlier this week in formally opposing a proposed, historic settlement of a federal antitrust lawsuit regarding credit card swipe fees charged by Visa and MasterCard.

Retailers such as Wal-Mart, Starbucks, Target and Domino's Pizza opted out of the proposed $7.25 billion class-action settlement by last month's deadline and filed formal objections for U.S. District Judge John Gleeson in Brooklyn, N.Y., to consider, the Minneapolis Star Tribune reported. But Target and Macy's have filed a new lawsuit seeking damages.

The attorneys said the settlement's ban on future lawsuits concerning swipe fees and credit card rules would violate their authority to sue regarding actions that harm their states' citizens.

"As drafted, the settlement agreement opens the door for defendants to assert settlement releases against attorneys general or other law enforcement agencies in future law enforcement actions related to the payment card industry," said a brief filed June 4.

The brief was filed by the attorneys general of Alaska, Arizona, California, Georgia, Indiana, Maryland, Ohio, Virginia and Wisconsin. The District of Columbia and every state except New Jersey and Oregon signed a "friend of the court" brief in support of the document.

Visa, MasterCard and a group of card-issuing banks allegedly colluded since 2004 to fix the swipe fees merchants pay to process cards, the Star Tribune reported. The interchange fees average about 2% of every purchase at the register and total about $30 billion a year—a significant operating expense for retailers.

The National Retail Federation (NRF) estimates that the swipe fees drive up consumer costs by more than $250 annually per average household.

"[The settlement] fails to address the price fixing that harms merchants and their consumers," said NRF General Counsel Mallory Duncan. "It takes away retailers' legal rights to ever try again, and it offers virtually nothing in return."

The proposed settlement is regarded as the largest private antitrust class-action settlement in U.S. history, one that involves more than 7 million U.S. businesses—just about every entity that swiped a Visa or MasterCard credit or debit card since 2004, the Star Tribune reported.

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