Payment Systems and Credit Cards

Retailers who need help with payment card issues, such as establishing co-brand relationships with issuers consult Mandell Menkes practitioners to create sound legal foundations for their programs. Our team is well-acquainted with the intricacies and business aspects of these transactions.  The agreements we prepare help avoid complications and unexpected outcomes during the life of card programs. A client with co-brand programs, which had merged with another retailer with its own co-brand programs, recently retained us to rework the framework all of the programs. We worked out a solution which seamlessly merged the two programs and the associated rewards programs.

Our attorneys were able to do this while avoiding a minefield of different underlying terms and obligations. Our transactional lawyers guided the client to a solution which avoided breaching the obligations owed to prior issuers and completed the transition without disrupting consumer relationships or rewards structures, and which resulted in an attractive value proposition. Whether you are initiating or renewing a payment card relationship, or have a dispute with a payment card partner, or need to address issues which have arisen in an existing program, our professionals will help you find a way through which minimizes your company’s legal risk and maximizes the success of the program.

Mandell Menkes has extensive experience in payment systems and credit, debit and gift card transactions.  We have advised some of the country’s largest retailers and major banks on payment systems issues, including Gramm-Leach-Bliley and state privacy laws, federal and state consumer credit, consumer protection and disclosure laws, and intellectual property and data security matters.  The Firm has also developed a reputation for providing cost effective representation.We have particular expertise in the following areas:

Co-Brand and Private Label Credit Card Transactions.  Mandell Menkes has an active practice in assisting retailers in negotiating and documenting co-brand and private label credit card transactions with banks and other card issuers.  The Firm’s work has included:


  • Advising retailers on the structure of request for proposal procedures and drafting questionnaires for prospective issuers.
  • Helping retailers to evaluate responses to requests for proposals and anticipate legal issues that will arise from specific terms proposed by prospective issuers.
  • Preparing letters of intent, term sheets and non-disclosure agreements.
  • Negotiating and drafting co-brand card issuing agreements, intellectual property licenses agreements and other contracts necessary to document the co-brand alliance.
  • Negotiating and drafting interim servicing agreements, portfolio valuation agreements and portfolio purchase agreements.
  • Counseling retailers on their rights and options under co-brand agreements, including their rights to obtain transaction and other data about cardholders, transfer portfolios, terminate agreements and add additional card issuers and new kinds of cards.
  • Assisting retailers in obtaining redress when performance metrics have not been met.
  • Protecting retailers when issuers securitize credit card receivables.
  • Advising retailers about federal and state laws relating to the issuance of rebates and other loyalty programs connected with card purchases.

We have handled numerous co-brand transactions in recent years.  Several of our deals have been for one of the world’s largest energy companies.  Among other transactions, we have:


  • Prepared all of the documentation for one of last year’s largest consumer co-brand agreements, which involved the transfer of a $1.6 billion portfolio.  The issuing agreement involved many cutting-edge provisions, including innovative sections relating to enhancement products, rewards, exclusivity and performance metrics.
  • Prepared all of the documents for a credit card program for owners of commercial vehicle fleets.
  • Guided a merchant through a series of amendments to its card issuing agreements which allowed it to divide the portfolio into two parts and transfer those parts to separate new issuers.
  • Crafted an agreement to allow an issuer to securitize receivables, while at the same time protecting the retailer’s right to transfer the portfolio upon the termination of the issuing agreement.
  • Formulated a strategy to allow two retailers that had recently merged, and which each had multiple credit card programs, to coordinate the termination dates of their issuing agreements and their post-termination servicing agreements to allow a new issuer to issue the same cards to the customers of both retailers.
 Gift Cards.  Mandell Menkes is a leader in this emerging area, and has developed unique strategies to allow its clients to issue gift cards in multiple states, without having to make state-by-state variations in disclosures, card features and packaging.  We work on a daily basis with issues which arise with gift cards, including escheatment and abandoned property laws, dormancy fees, expiration dates, consumer fraud laws, privacy laws, banking laws, money transmitter laws and anti money laundering laws.