TOPEKA, Kan. (Legal Newsline) – Kansas’ 34-year-old law that prohibits businesses from passing fees associated with credit transactions onto consumers is being challenged in court.
CardX filed a lawsuit on May 29 in Kansas federal court that says the 1986 law is unconstitutional and that other no-surcharge statutes in California, Florida, New York and Texas have been struck down.
In Oklahoma, state Attorney General Mike Hunter concluded that state’s law violated the First Amendment as it restricts commercial speech.
“CardX brings this constitutional challenge because CardX is unable to sell its software to Kansas merchants, who in turn are unable to pass on credit card processing costs to credit-paying consumers, due to the unconstitutional restriction imposed by Kansas’ no-surcharge statute,” the lawsuit says.
CardX has patent-pending payment processing software that allows merchants to display and process price differentials, allowing consumers to comparison shop among payment types.