The Green Sheet: “CardX adds Kansas to growing roster of surcharge-friendly states”
“CardX, a technology solutions provider specializing in credit card surcharging, scored a legal victory on Feb. 25, 2021 in the U.S. District Court, making Kansas the 47th state to officially recognize the CardX surcharging model. Jonathan Razi, chief executive officer at CardX, called the resolution of CardX LLC v. Derek Schmidt, a defining moment for the payments industry.
Razi, a Harvard Law graduate, thanked U.S. District Judge John W. Broomes for his favorable ruling affirming the constitutionality of the CardX technology solution. “Surcharging is becoming even more prominent as payments continue to move online,” Razi said in a statement. ‘And, with upcoming interchange increases in April, this is timely relief for the many companies that will be looking to reduce their costs of payment acceptance.’
CardX COO Michael Tomko, also a Harvard Law graduate, was also pleased with the decision and noted the court ruling pertained specifically to CardX; he urged service providers to review state guidelines. The court held that prohibiting credit card surcharging was unconstitutional ‘as applied’ to CardX and CardX’s software, leaving open the possibility that the court could challenge the constitutionality of other surcharge solutions, he stated.
‘There is still the possibility that the Kansas statute could be enforced against other merchants or providers if the fact pattern were different,’ he said. ‘Compliance continues to be the defining question in the surcharging space.’”