First Amendment

Ban on credit-card surcharges is a free-speech violation, 11th Circuit says

  • Print

A federal appeals court has struck down a Florida law barring merchants from imposing a surcharge on customers for credit card use.

The law, which allows discounts for cash, violates the First Amendment because it targets businesses that want to call price differences based on credit card use a surcharge rather than a cash discount, according to the 2-1 decision (PDF) by the Atlanta-based 11th U.S. Circuit Court of Appeals.

“Tautologically speaking,” the opinion said, “surcharges and discounts are nothing more than two sides of the same coin; a surcharge is simply a ‘negative’ discount, and a discount is a ‘negative’ surcharge. As a result, a merchant who offers the same product at two prices—a lower price for customers paying cash and a higher price for those using credit cards—is allowed to offer a discount for cash while a simple slip of the tongue calling the same price difference a surcharge runs the risk of being fined and imprisoned.

“The First Amendment prevents staking citizens’ liberty on such distinctions in search of a difference.”

The case is Dana’s Railroad Supply v. Florida.

Hat tip to How Appealing, which links to coverage by the News Service of Florida.

Give us feedback, share a story tip or update, or report an error.