Synchrony Responds to Walmart's $800M Lawsuit

by Arkansas Business Staff  on Friday, Nov. 2, 2018 2:58 pm   1 min read

Synchrony issued a statement on Friday in response to the lawsuit filed Thursday by Walmart Inc. in U.S. District Court for the Western District of Arkansas.

In the lawsuit, Walmart alleges that its longtime credit-card issuer breached the terms of its contract and that some of Synchrony's underwriting standards caused financial harm.

Walmart is seeking damages "in an amount to be proven at trial but estimated to be no less than $800 million." The company is also moving its business to Capital One Financial Corp.

In a statement, Synchrony called Walmart's lawsuit "baseless and without merit" and said it was an attempt to "exert leverage and avoid the contractually defined process for valuing the loan portfolio that Synchrony has serviced on behalf of millions of Walmart customers for the last 20 years."

Synchrony said it applied the same underwriting and decision-making processes to the Walmart portfolio as it does to others, and said it intends to show that Walmart failed "in the most basic elements of our contract, including its promotion of the card program both in stores and online."

Walmart responded to Synchrony's statement by saying Synchrony "breached its contractual obligations to Walmart and as a result, the damages to our company are estimated to be at least $800 million.

"We made every attempt to resolve this business dispute and avoid litigation, however Synchrony has failed to take responsibility for its actions. We fully expect Synchrony to manufacture counterclaims in an effort to shift the focus away from its own conduct," the company said.

 

 

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