Corner Post: What the Decision Could Mean for Debit-Card Interchange

In this edition of Take a Second, we’re breaking down a recent Eight Circuit Court of Appeals decision impacting debit-card interchange fees. The Corner Post Inc. v. Board of Governors of the Federal Reserve System case was recently decided, and the decision will likely impact the interchange fees that can be charged on debit-card transactions. It will require the Federal Reserve to revisit Regulation II and how debit-card interchange fees are calculated. So, without further ado, let’s dig in. 

Quick Background on Corner Post 

Corner Post, Inc. is a truck stop and convenience store located in North Dakota. In 2021, they brought a lawsuit under the Administrative Procedures Act against the Federal Reserve, challenging the Federal Reserve’s rulemaking: Regulation II. The case originally reached the U.S. Supreme Court over whether the challenge was filed within the statute of limitations. The Court found that it was timely and sent the case back to the District Court in North Dakota for review. 

In 2025, the District Court held that the Federal Reserve exceeded its authority by setting a blanket 21-cent cap on debit-card interchange fees. On appeal, the Eighth Circuit agreed, finding that certain fixed costs should not have been included in the cap. The court also found that the Federal Reserve should have created multiple “standards,” rather than a single uniform cap. 

What Does This Mean? 

Considering the recent decision, the Federal Reserve will need to come up with a new fee structure that reflects what Congress outlined in the Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Court provided guidance on what the Federal Reserve should consider, emphasizing that the agency must follow the law as written by Congress rather than rely on its own interpretation, as it did when creating the previous cap. 

Potential Impacts 

Under a new fee structure, credit unions and other financial institutions could recoup more than the previous 21-cent cap on some transactions, but less on others. That makes it important to closely monitor the process and provide input where possible to ensure credit unions are fairly compensated for their role in the payments process. 

Emerging Development with Linney’s Pizza Decision in the Wings 

While the Eighth Circuit has issued its ruling in Corner Post, another challenge to the Federal Reserve’s Regulation II is pending before the Sixth Circuit Court of Appeals. In Linney’s Pizza v. Board of Governors of the Federal Reserve, the District Court ruled in favor of the Federal Reserve. If the Sixth Circuit upholds that ruling, it could create a circuit split and set the stage for another U.S. Supreme Court appeal. 

To sum it up… 

We will continue to keep an eye on the Linney’s Pizza case and the Sixth Circuit Court of Appeals decision. Depending on the outcome, the Federal Reserve will either be back to the drawing board or we will be waiting for yet another appeal. For the moment, we are going to keep an eye on the pending litigation and on the Federal Reserve.  

As always, this article is intended for general information only and does not constitute legal advice. If you have any questions about this topic and/or possible implications, you should contact your attorney for advice.  

Hope to see you next time when we take a second to break down another trending legal topic!