Retailers appear to have accepted the provisions of the FederalReserve's debit interchange rule that regulate how many payment networksmust be available for each debit transaction.

Under the Fed's rule, credit unions and other debit issuers haveto make sure at least two unaffiliated payment networks areavailable for debit transactions.

In practice, that has usually meant one payment network toprocess signature authorized transactions and one to process PINauthorized transactions.

Retailers challenged this part of the rule, arguing that theDurbin Amendment to the Dodd-Frank financial reform lawrequired issuers or networks to provide more options for paymentprocessing.

The U.S. Court of Appeals for the D.C. Circuit rejected thoseefforts when it affirmed the Federal Reserve rule in March.

In the application filed Monday to the Supreme Court to consideroverturning that decision, the National Retail Federation and othergroups attacked the amount of debit card interchange the ruleallowed, but did not mention the exclusivity rules except in afootnote that indicated the rules were not involved in theappeal.

“Petitioners also challenged a separate provision of the Rulegoverning card network non-exclusivity…That issue is not beforethis Court,” read a footnote on page 14 of the brief.

Doug Kantor, a partner in the Washington office of Steptoe andJohnson, who serves as counsel for the retailers, said the grouphad not raised the issue in the appeal because a previous brieffrom the Federal Reserve said the existing regulation had met thelaw's requirements.

“We had been concerned from the begining about our ability tocross process when necessary and when the Federal Reserve said itbelieved their existing regulation allows that, we took them attheir word,” Kantor explained. Kantor further explained theterm cross processiong means the ability to process a debittransaction authorized with a PIN across a signature debit networkand vice-versa. Such changes could be accomplished at thenetwork level and would require little or no changes at the issuerlevel, retailers had said in previous briefs.

Although only credit unions with more than $10 billion in assetshave to comply with the rule's debit interchange cap, all creditunions potentially faced having to make changes to their debitprograms had retailers challenged the network rules and won.