Walmart was given permission by a federal judge in March to end its credit card partnership with Capital One because of customer service issues, a federal judge ruled.

The agreement terms between the two “clearly dictate that Capital One’s repeated customer service failures entitled Walmart to invoke the Termination Right and terminate the parties’ ongoing partnership,”  U.S. District Court Judge Katherine Polk Failla wrote in a decision.

Walmart sued Capital One in April 2023, seeking to end its credit card partnership with the McLean, Virginia-based lender. Walmart alleged Capital One repeatedly failed to meet several contractual obligations of the card partnership, including promptly issuing replacement cards to customers as well as processing their payments and posting transactions to accounts in a timely manner.

The break-up also follows the announcement by Capital One earlier this year that it would seek to acquire the card company Riverwoods, Illinois-based Discover Financial Services. If completed, the deal would put Capital One ahead of JPMorgan Chase as the largest credit card issuer in the U.S.

By Lynne Marek on May 24, 2024
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