New York ? A federal judge postponed opening arguments Wednesday in a lawsuit by thousands of retailers over Visa USA’s debit card policies, saying the two sides were working toward a settlement.

U.S. District Judge John Gleeson rescheduled the arguments for Friday. He said both sides were negotiating in “good faith in an effort to resolve the case short of a trial. I applaud those efforts.”

The new twist came just two days after MasterCard International, which was to be a defendant in the trial with Visa, reached a settlement with the retailers, including Wal-Mart, Circuit City and Sears.

The retailers claimed both big card companies had trapped them into paying high fees by demanding that stores accept their debit cards along with their credit cards. The retailers also claimed the companies were stifling competition.

Visa said it did not immediately have a comment.