Capital One and Discover Financial are facing a lawsuit challenging their proposed $35 billion merger, which plaintiffs claim would reduce competition and increase prices. The class action, filed by two Capital One customers on July 22, 2024, in Alexandria, Virginia, alleges the merger violates US antitrust law. The deal, if approved, would create the largest US credit card issuer by balance and the sixth-largest bank by assets. This announcement has sparked opposition from some members of Congress and has raised the possibility of extensive antitrust scrutiny.
Capital One and Discover argue that the merger would enhance competition in the credit card and payment processing markets. Capital One dismissed the lawsuit as meritless, while Discover has yet to comment. The US Justice Department and Federal Trade Commission have not formally acted against the merger. The lawsuit demands either the prevention of the merger or the implementation of measures like asset divestment to address anti-competitive concerns. The case, Tyler Baker and Lora Grodnick v. Capital One Financial and Discover Financial Services, is currently pending in the US District Court for the Eastern District of Virginia.
