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PayPal Settles Class Action Lawsuit
ephidryn writes "I just received a notice from paypal which indicates that I may be involved in a class action lawsuit against paypal. Apparently two PayPal users, Roberta Toher and Jeffrey Resnick, filed two seperate lawsuits that were later combined into one class action suit. ZDNet has a story that notes: "PayPal said it would pay a total of $9.25 million to settle the federal class-action suit..."
I'm so ready to receive my check for $0.35US" kai5263499 adds "The settlement states that anyone who opened an account between Oct 1, 1999 and Jan 1, 2004 is elegible to participate in the settlement. According to their Plan of Allocation you can fill out a short form or a long form to sign up."
The ZDNet story they link in the article is actually for eBay's problem with double charging fees, but mentions the PayPal situation near the end...
THIS is the actual PayPal story (from 6/14/04), which is referenced at the bottom of the eBay one linked in the article.
One of the things they ask you when you fill out the short form is if you want the $50 put in your paypal account. Which means paypal will still get interest off the majority of those that do have their $50 sent to their paypal account.
-Wes
I got the email too, but I can't figure out if I can claim anything or not. I luckily never had my account suspended or overcharged, but it looks like the suit may get me something anyway... Is that right?
Dear [Your Name],
IF YOU OPENED A PAYPAL ACCOUNT BETWEEN OCTOBER 1999 AND JANUARY 2004, YOU MAY BE ENTITLED TO A PAYMENT FROM A CLASS ACTION SETTLEMENT.
PLEASE READ THIS NOTICE CAREFULLY.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION
In re PayPal litigation
Case No. CV-02-01227-JF (PVT)
NOTICE OF PENDENCY OF CLASS ACTION AND PROPOSED SETTLEMENT
1. WHY DID I GET THIS NOTICE?
You have been sent this Notice because the records of PayPal, Inc. indicate you are a current or former PayPal account holder. This means you may be eligible to receive a payment from the proposed class action settlement in the lawsuit In re PayPal Litigation, Case No. 02 1227 JF PVT, pending in the United States District Court for the Northern District of California in San Jose. This Notice provides a summary of the terms of the proposed settlement. It also explains the lawsuit, your legal rights under the settlement, what benefits are available to you under the settlement, and how to get them.
2. WHAT IS A CLASS ACTION?
In a class action, one or more people, called Class Representatives (in this case Roberta Toher and Jeffrey Resnick), sue on behalf of people who have similar claims. All of these people are members of the Class. One court resolves the issues for all Class Members, except for those who exclude themselves from the Class. United States District Judge Jeremy Fogel is in charge of this class action.
3. WHAT IS THIS LAWSUIT ABOUT?
In early 2002, Plaintiffs Roberta Toher and Jeffrey Resnick filed separate lawsuits against PayPal, Inc. These two cases were later consolidated into one lawsuit in the United States District Court for the Northern District of California, San Jose Division, entitled In re PayPal Litigation, Case No. CV 02 01227-JF (PVT). The lawsuit alleges that PayPal violated the federal Electronic Fund Transfer Act ("EFTA"), 15 U.S.C. 1693 et seq., including provisions requiring PayPal to supply customers with information about dispute resolution procedures and to follow certain procedures when investigating complaints of unauthorized or incorrect electronic fund transfers. For example, the lawsuit claims that PayPal did not provide account statements in the manner required by the EFTA. The lawsuit further alleges that PayPal has placed inappropriate restrictions or other limits on customers' accounts and engaged in other improper practices. Based on these practices, the lawsuit asserts claims under California state law for conversion, money had and received, negligence, and violations of consumer protection statutes.
PayPal does not believe that it did anything wrong. In fact, PayPal disputes that the EFTA, originally passed in 1978, applies to its business. PayPal denies any and all liability for the claims alleged in the lawsuit. The Court did not decide in favor of the Plaintiffs or PayPal. Instead, beginning in the fall of 2003, the parties began a series of settlement negotiation sessions mediated by United States Magistrate Judge Edward Infante. Eventually, in November 2003, both sides agreed to a settlement in principle. By settling their claims, both parties avoided the uncertainty and cost of a trial. The settlement provides money and other benefits to the Class. On June 11, 2004, the parties entered into a formal, written Settlement Agreement, which is on file with the Court and available on the Internet at https://www.paypal.com/settlement/. By entering into the Settlement Agreement, PayPal is not admitting any wrongdoing. PayPal continues to believe that it did not do anything wrong. The Representative Plaintiffs and the attorneys appointed by the Court to represent the Class believe that the settlement is fair to Class Members. By this notice, the Court is not expressing any view on the merits of the lawsuit.
4. HOW DO I KNOW IF I AM PART OF THE SETTLEMENT?
On July 12, 2004, Judge Fogel entered an order granting preliminary approval of the settlement and certifying the
© 2004 The SCO Group, Inc. All Rights Reserved.
$3.4 million (about 1/3) of which would go to paying its customers' legal fees
So who's the winner here?
Uselessful technology (Air-Charged
Man, Pay Pal is good stuff. I hope this doesn't get them flushed down the old corporate crapper. I know several people who were protected against fraud because they used PayPal. Can I get a witness up in here for Pay Pal?
Sounds like another one of those phishing scams to me! ;)
I just love how they claim that banking laws don't apply to them. It's amazing what you can get away with if you have the cash.
Free Mac Mini Yeah, it's
Really, the article states that paypal didn't hold up to some regulations which require them to have some kind of service in case a deal goes wrong. I buy something from you, and it appears to be broken. Now I should be able to resolve this through paypal. This might be good for the customer, but from paypal's view this is nuts. They are just an intermediary that handles the monetary transactions.
As an analogy, suppose you pay something using an ATM, you can't honestly expect the bank to resolve your problems with the product you just bought.
Come on, CLICK HERE. I know you want to do it.
Please login to access my lawn
The rules of submission require you to state that you experienced a financial loss, due to very specific circumstances. Most PayPal account holders (the vast majority, I think) have experienced no financial losses as a result of any of the claims stated in this class action's resolution.
Therefore, don't get too excited -- the average PayPal account holder gets nothing from this Class Action resolution...
-- -pjk Perry Kundert perry@kundert.ca http://kundert.2y.net
The settlement states that anyone who opened an account between Oct 1, 1999 and Jan 1, 2004 is elegible to participate in the settlement.
No it doesn't. It explicitly excludes residents of every country Paypal operates in except for the USA. I wish people in the USA wouldn't use the word "everyone" when what they mean is "everyone in the USA".
If they could just release the $150 on my 3-year-blocked account, that'd be better... Why did I do nothing to recover my money by force (i.e. go to small claims court or hire an attorney)? because it's less expensive to be scammed out of $150 by Paypal than to wrestle that money out of them, and that's why they get away with this. Why people would sign up with a non-FDIC insured bank (because that's what they are in effect), I'll never know. I did and I won't ever again.
Oh well, with any luck, soon I'll only be out of $149.65...
"A door is what a dog is perpetually on the wrong side of" - Ogden Nash
Not if you're a resident of the EU...
Is this why I not that many months ago got an e-mail about my PayPalaccount now being handled by their EU-company instead of the US one???
perl -e'print$_{$_} for sort%_=`lynx -dump svanstrom.com/t`'
Not necessarily, here is one of possible reasons:
:)
You requested information from PayPal about an account restriction or limitation or unauthorized transfer and you did not receive a satisfactory response
So if you ever emailed their support about something related to the account and were not satisfied with their response, you are in
The wording of this says that you are automatically in the lawsuit. But if you want the money, then you have to claim it via an electronic form and then mail in the signature.
If you don't do that, then you don't get the money - but you are still considered to be in the lawsuit - which means that you then waive the right to sue them in the future for related issues.
But if you don't want to be in the lawsuit, then you have to also mail something in.
It also states that the lawyers get at least $3+M for this and that is out of nearly $10M.
I don't know how many people are in it, but the remainder of the money would then be split amongst those people.
So at most it is still under $100 - that isn't enough to pay me off so that I can't ever sue them again - even if it is only in a specific area.
There are some odd things afoot now, in the Villa Straylight.
you can fill out a short form or a long form to sign up.
I can do either a short form or a long form? That's like saying:
1) I can be the recipient of a swift kick to the nuts
2) or I can have some ice cream.
I wonder which one I want to choose.....
With the amount of the settlement per-person, this feels like a mail-in-rebate. I.E., the amount is so small vs. the hassle (filling out a form) that most people will likely forgo the cost of a cup of coffee so they don't have to fill out anything.
Which means, in the end, that this verdict will mean very very little to paypal. They should give their lawyers a bonus.
That is just the poster ramling about nothing.
The amount you get for filling out the "short form" is $50.
The amount you get for filling out the long form is undetermined. **It all depends on how many people bother to collect**. The judgement was for 9.25 million - 3.4 million for legal leaves 5.85 million for settlements. Unless millions of people apply ( unlikely) you would likely get your $150 back, no problem.
***DO APPLY***
Since you failed to read the settlement itself than you probably wont read this but...
4. HOW DO I KNOW IF I AM PART OF THE SETTLEMENT?
On July 12, 2004, Judge Fogel entered an order granting preliminary approval of the settlement and certifying the following class for purposes of the settlement: All Persons who opened a PayPal account during the period from October 1, 1999 through January 31, 2004. Excluded from the class are any judicial officer to whom the lawsuit is assigned; PayPal and any of its affiliates; any current or former employee, officer, or director of PayPal; anyone who resides in Austria, Belgium, Denmark, Germany, Greece, Finland, France, Ireland, Italy, Luxembourg, Portugal, Spain, Sweden, The Netherlands, or United Kingdom; and all persons who timely and validly request exclusion from the class pursuant to this notice.
"I'm so ready to receive my check for $0.35US"
..... ;)
Think again
"The claims administrator will not issue checks for less than $1.00. Such amounts will instead be reallocated to those claimants who are entitled to receive distributions."
[alk]
Paypal saved my ass when some dude from the Philipines ordered a notebook PC and a modded Playstation using my account -- while my network is ironclad at home, it turns out that the one at work... not so much. Never doing anything like that at work ever again. I could have been out $2000+ because of fraud, but they fought the good fight.
On the other hand, back in 2002 they beamed $172 into nowhere and never returned the money, so some of this lawsuit does kinda ring true. The crap I had to go through was more than I should have, and I still didn't get my money back. Here's to filling out another form and hoping to see that cash.
I am Leviathant and I approve this message.
Some people actually like Paypal. Maybe you'd like to accuse iPod lovers of astroturfing? Linksys / Cisco lovers? Or is astroturfing reserved for groups on slashdot whose opinion are a minority? There's a lot of brand loyalty on slashdot, despite the air of anti-corporatism.
This page raises some good possible issues about at least one anti-paypal site, and shows that some claims against paypal payments are also true of many other forms of payment:
Adzooks: Paypal ain't my buddy
Everyone is entitled to statutory damages:
"The plan of allocation designates $1 million of the Net Settlement Fund to a "Statutory Damage Fund," to be distributed equally among all Fund Claimants who are not Dispute Resolution Claimants."
If you want to claim these damages, you must mail them a letter with your signature. So I suggest you don't bother as the amount of the stamp will likely be greater than the amount of the settlement damages paid.
In my opinion, it's great that they plan to shell out 9 million dollars in order to "just forget it and move on", but it comes nowhere close to the damages and losses acquired by the thousands of people who have had serious issues with them. They still have the right to freeze your account, they still have the right to keep your money at their own discretion, and they still have the right to take it out of your ass if someone else screws you with a bad card. As far as I can tell, the only thing they're agreeing to change is how they handle disputes. Meh. Something's gotta be done about online-payment companies. A simple payoff accomplishes nothing.
eBay now rounds a bill of $30.78 up to $30.80. Despite the fact that the system tacks on only a few cents to each transaction, the customers said the additional charges add up over time.
Sounds familiarI think we can keep recursing like this until someone returns 1
Hey, wait a minute...you can't presume to lecture us on behalf of the rest of the entire world.
That's France's job.
If you don't know where you are going, you will wind up somewhere else.
You are going to get your percentage of the 9.5 million based on the amount of claims made and the amount you claim and can legally prove was stolen from due to neglect on paypal's part.
For instance I had a loss of $80 + over $100 in collection costs/subpoenas in 2002. If there are claims for OVER 9.5 million, the claims will start to be divided into the percent that you made it up to 9.5 million.
I am hoping that I will get at least $100.
The 35 cents was a stupid quip the editor made.
Yell & scream & rant & rave... it's no use... you need a shaaaave ~ Bugs Bunny
I've known many, many people who were royally fucked by PayPal, so I have to disagree. You're talking about a company that acts like a bank, but is not regulated like a bank. You're talking about a company that can arbitrarily freeze assets with no accountability. In my mind, PayPal is a big fraud, and I would never give them a dime. If you want to buy something, and you want protection, use your credit card: that's *real* buyer's fraud protection. It's mandated by federal law.
You can make a Short Form Claim if, prior to February 1, 2004, PayPal caused you to lose money because of any of the following:
I just imagined it continuing a bit differently...
And so on...
--Mark
"It is nice to know that the computer understands the problem. But I would like to understand it too." --Eugene Wigner
Log into your paypal account. In the My Account/Overview section, look for your Name, Email and Status, click on the little number in parentheses next to status (looks like this):
Status: Verified (23)
That will give you your member info box with your sign up date.
-gary
The lawyers get $3.3M. Wow. Where do I sign up to be a class action ambulance chaser? :)
Is it smarter to apply and collect whatever money you may (if you cannot prove damages), or to exclude yourself for the future if something bad DOES, indeed, happen to your account (and your money). I would try to exclude myself personally seeing that if 2 million people apply for their part of the settlement, i'd only get about $0.50.
The folks over at PayPalSucks.com have been fighting the shady practices of PayPal since its inception. It's a great source of information and a good browse for everyone who has accounts with PP. Just keept the bias in mind ;) Here's a link to their discussion forum regarding the settlement. Very informative.
NMG
The short form limits your claim to $50 max, or whatever percentage if there is more than about 90,000 people filling it out. The long form, however, will allow you to get more... again, assuming that a small enough number of people sign up.
Have you been touched by his noodly appendage?
I'm so ready to receive my check for $0.35US
/. it WILL be $0.35! THANKS.
Well now that you put it on
Please send a self-addressed stamped envelope...
You need to read it again. In particular the section regarding "Statutory Damage Fund Claimants".
- Toby
Does anyone else find it strange that the claim forms ask for your PayPal password and credit card number?