Unethical Business Research Practices
What unethical research behavior was involved?
The antitrust case brought by Wal-Mart and other retailers against Visa and MasterCard in the U.S. Eastern District court, was settled in 2003 for $3 billion and primarily involved a dispute concerning the efficient pricing of access to payment information, including security data that confirmed or refuted the transactional identities of cardholders (Roberds & Schreft, 2009). In their pleadings, Wal-Mart and other class action litigants argued that third-party providers such as Visa and MasterCard required them to accept both debit and credit cards issued by MasterCard but the interchange fees were higher for debit cards (Ulzheimer, 2012). In sum, the suit filed by Wal-Mart and other large retailers claimed that Visa and MasterCard "required all merchants who accept their credit cards to also accept their signature debit cards [which] constitutes an illegal tie-in in violation of antitrust law" (Peterson, 2002, p. 31). In their responsive pleadings, the defendants maintained that the plaintiffs' argument failed to satisfy the definition of tying because their so-called "honor-all-cards agreement" with merchants did not preclude them from "steering their customers toward PIN-based debit transactions with their concomitant lower merchant fees" (Peterson, 2002, p. 32). In reality, though, the case focused on the fundamental right of the class action litigants to timely and accurate research information as discussed further below.
Who were the injured parties?
The class action was brought by Wal-Mart...
Since these are global trends, the outcome of the Wal-Mart class action suit has world-wide implications for retailers in defining what constitutes ethical practices. With respect to the outcome for the litigants, according to Ulzheimer, "The retailers won the suit and were paid $3 billion by MasterCard and the issuing banks in damages and had to change some business practices costing another $25 billion" (2012, para. 3).
The practices that were used by Visa and MasterCard that formed the focus of the lawsuit in question fall under the category of normative business ethics, in other words, how companies should behave and what governance mechanisms should be in place to ensure such ethical behaviors (Azola, 2011). In this case, the aggregation of enormous amounts of personal identifying data (PID), including some aspects of individual identities such as name, birth date, Social Security number, and unique personal identifying data) has allowed third-party providers such as Visa and MasterCard to charge a fee for verifying transactional data used…
