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As a professional flack, I have massive respect for the PayPal flack who got this on the front page of Slashdot, I would not even have tried. There is a reason for sites like PayPalSucks. Speaking only for myself, my personal experience with PayPal has been HORRIBLE. Currently, I use We Pay and thus far have not had any issues. Speaking ONLY for myself.

First, three blogs down, here's the actual court order. It's worth reading. A key point in this decision is what it has to say about agreements which allow one party to change the terms of the agreement. Such agreements were held to be "illusory" and non-binding:

Here, the Terms of Use gives Zappos the right to change the Terms of Use, including the Arbitration Clause, at any time without notice to the consumer. On one side, the Terms of Use purportedly binds any user of the Zappos.com website to mandatory arbitration. However, if a consumer sought to invoke arbitration pursuant to the Terms of Use, nothing would prevent Zappos from unilaterally changing the Terms and making those changes applicable to that pending dispute if it determined that arbitration was no longer in its interest. In effect, the agreement allows Zappos to hold its customers and users to the promise to arbitrate while reserving its own escape hatch. By the terms of the Terms of Use, Zappos is free at any time to require a consumer to arbitrate and/or litigate anywhere it sees fit, while consumers are required to submit to arbitration in Las Vegas, Nevada. Because the Terms of Use binds consumers to arbitration while leaving Zappos free to litigate or arbitrate wherever it sees fit, there exists no mutuality of obligation. We join those other federal courts that find such arbitration agreements illusory and therefore unenforceable.

This is an example of the classic "an agreement to agree is not an agreement".

An example of a site that's now in trouble is WePay. See Paragraph 50 of the contract.

With the currency troubles in Greece and Spain, a "cashless society" is much further off. One plan for Greece is to suddenly convert the bank account of everyone in Greece from euros to drachma, then immediately devalue the drachma. Since this is well known, everyone with any money is pulling it out of Greek banks.

Keeping money in "the cloud" means someone else controls it. For a good laugh, read the EULA of WePay, a wannabe PayPal competitor. Or those of Dwolla, which is a pseudo financial institution run out of a hacker space in Iowa. The terms offered by most psuedo-banks in the "cloud" are awful.

Umm... I think not http://tech.slashdot.org/comments.pl?sid=2439254&cid=37470742
Sorry but I doubt that any news channel would not show 10,000 protesters on Wall Street. Since the food committee only has $14000 that comes to a buck forty per person. https://www.wepay.com/donate/99275
Yea sure there is this massive secret protest going on.
http://english.aljazeera.net/news/americas/ doesn't even see it worth covering. I found a few news stores about it. Let me sum it up for you. Tiny, fringe, crackpot, protest.

Here's where WePay got the contractual language which allows them to "discard your account". They seem to have copied their terms of service from a non-financial site:

WePay TOS (2010):
You agree that WePay, in its sole discretion, for any or no reason, and without penalty, may suspend or terminate your Account (or any part thereof) or your use of the WePay Services and remove and discard all or any part of your Account at any time. WePay may also in its sole discretion and at any time discontinue providing access to the WePay Services, or any part thereof, with or without notice. You agree that any termination of Your access to the WePay Services or any Account you may have or portion thereof may be effected without prior notice, and you agree that WePay will not be liable to you or any third party for any such termination. Any suspected fraudulent, abusive or illegal activity may be referred to appropriate law enforcement authorities. These remedies are in addition to any other remedies WePay may have at law or in equity.

ClickPass (2008):
You agree that Clickpass, in its sole discretion and for any or no reason, may terminate any member or customer account (or any part thereof) you may have at the Clickpass Service or your use of the Clickpass Service, and remove and discard all or any part of your account, at any time. Clickpass may also in its sole discretion and at any time discontinue providing access to the Clickpass Service, or any part thereof, with or without notice. You agree that any termination of your access to the Clickpass Service or any account you may have or portion thereof may be effected without prior notice, and you agree that Clickpass shall not be liable to you or any third-party for any such termination. Any suspected fraudulent, abusive, or illegal activity that may be grounds for termination of your use of the Clickpass Service may be referred to appropriate law enforcement authorities. These remedies are in addition to any other remedies Clickpass may have at law or in equity.

CampassCompass TOS: (2008)
You agree that CampusCompass, in its sole discretion and for any or no reason, may terminate any account (or any part thereof) you may have with CampusCompass or use of the Service and remove and discard all or any part of your account, at any time. CampusCompass may also in its sole discretion and at any time discontinue providing access to the Service, or any part thereof, with or without notice. You agree that any termination of your access to the Service or any account you may have or portion thereof may be affected without prior notice, and you agree that CampusCompass will not be liable to you or any third-party for any such termination. Any suspected fraudulent, abusive, or illegal activity that may be grounds for termination of your use of the Service may be referred to appropriate law enforcement authorities. These remedies are in addition to any other remedies CampusCompass may have at law or in equity.

For the other two services, an "account" is just a login and some files. But with WePay, an "account" has money in it. And WePay can "discard" it any time they want to, given this language. That's worse than PayPal.

The problems with PayPal are well known. PayPal should be regulated as a bank in the US, so customers have recourse to banking regulators when PayPal is holding the customer's money against the customer's will.

Not that PayPal's competitors are better. WePay got press by putting a block of ice with money inside in front of the PayPal conference. But they have miserable customer terms, like PayPal:

• You may not transfer or assign any rights or obligations you have under this Agreement without WePay's prior written consent. WePay reserves the right to transfer or assign this Agreement or any right or obligation under this Agreement at any time. That's backwards, since they have your money, and you don't have their money.
• You agree that WePay, in its sole discretion, for any or no reason, and without penalty, may suspend or terminate your Account (or any part thereof) or your use of the WePay Services and remove and discard all or any part of your Account at any time. Discard your account? With your money in it? That's what they're saying. Banks have to immediately refund your money if they close your account.
• IN NO EVENT SHALL WEPAY, its EMPLOYEES OR SUPPLIERS BE LIABLE FOR LOST PROFITS OR ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR IN CONNECTION WITH OUR WEBSITE, OUR SERVICES, OR THIS AGREEMENT (HOWEVER ARISING, INCLUDING NEGLIGENCE), UNLESS OTHERWISE REQUIRED BY LAW. Banks can't get away with that.
• WePay reserves the right to change, modify, add, or remove portions of this Agreement (each, a "change") at any time by posting notification to the WePay website or otherwise communicating the notification to you. That's out of line for a bank-like service.
• Any Claim between you and us shall be resolved, upon the election of either you or us, by binding arbitration. So you can't sue them. Banks have been in trouble for that, even for credit cards, where you owe them money. Remember, WePay is a depository institution - they hold your money. You never owe them money.

As for having a "brick and mortar" location, when I run WePay.com through SiteTruth, it reports the address of a house in San Jose. That's the address they gave the U.S. Securities and Exchange Commission as their place of business.

1. WePay

2. Google Checkout

3. Amazon Payment