Seventh Circuit Remands Illinois Swipe Fee Case to District Court
The U.S. Court of Appeals for the Seventh Circuit has vacated a lower-court decision regarding the Illinois Interchange Fee Prohibition Act (IFPA) and remanded the case to the U.S. District Court for the Northern District of Illinois. This ruling, issued on May 8, 2026, cancels scheduled oral arguments and returns the legal battle to the trial court just weeks before the law’s July 1 effective date. The IFPA aims to prohibit interchange fees on tax and gratuity portions of card transactions. The remand follows recent interim final actions by the Office of the Comptroller of the Currency (OCC), which concluded that federal law preempts the IFPA for national banks. Banking and credit union trade groups, including the American Bankers Association, view this as an opportunity to reinforce their preemption arguments. The district court must now determine the weight of the OCC’s order, which takes effect June 30. This development creates uncertainty for financial institutions and merchants, with potential implications for similar legislation in other states. The case originally stemmed from a February ruling by Judge Virginia Kendall, who upheld fee restrictions but enjoined data-use limits.
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Seventh Circuit Remands Illinois Swipe Fee Case to District Court
The U.S. Court of Appeals for the Seventh Circuit has vacated a lower-court decision regarding the Illinois Interchange Fee Prohibition Act (IFPA) and remanded the case to the U.S. District Court for the Northern District of Illinois. This ruling, issued on May 8, 2026, cancels scheduled oral arguments and returns the legal battle to the trial court just weeks before the law’s July 1 effective date. The IFPA aims to prohibit interchange fees on tax and gratuity portions of card transactions. The remand follows recent interim final actions by the Office of the Comptroller of the Currency (OCC), which concluded that federal law preempts the IFPA for national banks. Banking and credit union trade groups, including the American Bankers Association, view this as an opportunity to reinforce their preemption arguments. The district court must now determine the weight of the OCC’s order, which takes effect June 30. This development creates uncertainty for financial institutions and merchants, with potential implications for similar legislation in other states. The case originally stemmed from a February ruling by Judge Virginia Kendall, who upheld fee restrictions but enjoined data-use limits.
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