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Uncategorized Friday, October 5th 2012 at 9:45 am

PayPal Arrives Late to the Party, Updates Policy to Prevent Users From Joining Class-Action Lawsuits

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Over the past year, there’s been a slew of Terms of Service updates pushed through by various companies to prevent their users from joining class-action lawsuits. Sony’s already on the bandwagon, as is Netflix. AT&T‘s had a similar clause for some time now. Not content to let other businesses have all the fun, PayPal has finally decided that they too like this idea of not being involved in class-action lawsuits. The update hits November 1st, and they’ve made opting out of it a hassle, because of course they did.

Specifically, users have until December 1st to opt out. Unfortunately, this requires using snail mail to inform PayPal of your decision, which is just asinine and intentionally difficult. They know that the majority of users won’t bother to send off something they actually have to stamp. New users will have to do the same within 30 days of signing up.

Here’s the relevant bit from the update on how to actually send your opt-out notice:

You must mail the Opt-Out Notice to PayPal, Inc., Attn: Litigation Department, 2211 North First Street, San Jose, CA 95131.

The Opt-Out Notice must state that you do not agree to this Agreement to Arbitrate and must include your name, address, phone number, and the email address(es) used to log in to the PayPal account(s) to which the opt-out applies. You must sign the Opt-Out Notice for it to be effective.

Perhaps the oddest part here is that it doesn’t seem like PayPal will actually terminate accounts if they opt out. They still want your money, they just don’t want you joining a class-action lawsuit. If it’s important enough for you to mail them, though, sure. The whole thing’s reminiscent of Facebook’s updates where they force folks to opt out of various changes, because they know the majority of people aren’t going to care enough to do so.

In other words, it’s kind of evil.

(PayPal via reddit)

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  • http://www.facebook.com/zach.fortier Zach Fortier

    Isn’t any contract void if there’s a law that supercedes it? There must be some law that states you’re allowed to a class action lawsuit.

  • Rollin Bishop

    It really depends on where you are. For example, Canada apparently forbids this kind of practice. Canadians can get in some class-action lawsuits all they want.

  • Electronic Paymt is no good…

    They are reacting to the latest uMitB hack attack! (Google uMitB and Gizmodo)

  • Rollin Bishop

    Maybe, but it’s more likely just the culmination of something that’s been in the works for a while now. Most of the ToS updates came earlier this year after the PSN outage from last year.

  • ID Withheld

    They lost a lawsuit in 2002 for this same unethical practice. I wonder what sort of excuse or preposterous line of implausible deniability their lawyers concocted to use this time.

  • Hank

    No law against it. Actually the US Supreme Court in 2011 created law that protected arbitration provisions in service contracts. The holding was specifically designed to kill class actions -which are the only deterrents to corporate ripoffs. ATT v Concepcion case. 5 conservative Justices in the pockets of US Chamber of Commerce. This just further proves how important this Presidential election is – two of our of our liberal justices are getting old and will retire in the next few years. The nation can’t afford more republican appointees.

  • cheyo Rodriguez

    cant we class action opt out? as a group

  • Brad

    I’ll opt out, but class action suits never make those wronged whole again in reference to whatever happened, all they do is get you a $10 gift card while making some f#*stick bottom feeding lawyer rich.

  • Paypal is PP

    wouldn’t it be great if someone could come up with a clever way of managing transactions like these over the internet so we wouldn’t have to use mail?

  • Ron

    Pretty sleazy tactics by PayPal. If they want snail mail lets give it to them bombard them with mail at PayPal, Inc., Attn: Litigation Department, 2211 North First Street, San Jose, CA 95131

  • oneinterestedparty

    THANK YOU, THANK YOU, THANK YOU!!!!!!!!! Those effers! I was trolling the site looking for “opt-out” link and sure enough, had to google it! I cannot believe how devious they are and the fact they are a NON-bank behaving like a bank is an atrocity anyway. Again, thank you!

  • Raj

    Does this apply to Canadian users as well? If we have the option to opt out as well I want to make sure the letter goes to the right office (i.e. Canadian vs U.S. based office)

  • http://www.facebook.com/van.king.52 Van King

    What about the “unalienable rights” bit in the Constitution?

  • Ed

    Actually, the real litmus test that has been ongoing for years by both parties for Supreme Court appointees is that the justice will not interfere with free trade agreements. Thus we have corporations writing laws and getting them imposed to supersede national, state and local law. Eliminating a Supreme Court that would put an end to this has been a long term agenda for both parties. Only the terminally stupid think this will change by re-electing from the same ruling class that runs both parties.

  • Ed

    Forcing you to sign away your legal rights is just a minor step in corporations’ displacing democratic governance with their own ruling class. Corporations will soon decide what you are allowed to read, what you are allowed to eat, what you are allowed to own, and eventually what you can access on this web, all courtesy of WTC and both major political parties, whose primary aim is to protect the interests of the ruling class.

    The notice PayPal users are receiving carries no instructions for opting out, no signature of a responsible person and no address. This may be insufficient to meet their obligations to notify. Consider copying their notice that reveals insufficient data for opting out and sending that with a copy of your letter as you file a complaint with California’s Attorney General.

    Kamala D. Harris
    Attorney General’s Office
    California Department of Justice
    Attn: Public Inquiry Unit
    P.O. Box 944255
    Sacramento, CA 94244-2550

    There is no easily discoverable Attorney General division that handles such complaints, but since we are asked to send to CA address, it is likely these folks must operate under CA law–at least until the next president signs most relevance of state and U.S. law away in the next “free trade agreement,” which actually happens to be on Obama’s desk right now.

    Here is a template to make opting out a bit easier. It can be cleaned up with a few formatting strokes in Word.
    ————————-
    Your Name
    Street Address
    City, State, Zip
    DATE

    PayPal, Inc.
    Attn: Litigation Department
    2211 North First Street, San Jose, CA 95131.

    Dear PayPal:

    This is my Opt-out Notice. I do not agree with PayPal’s
    Agreement to Arbitrate. The phone number and email I use to log into my PayPal account are respectively XXX-XXX-XXXX and XXX@YYY.XXX.

    I believe your notice for opting out that carries no explicit instructions for opting out, no signature of a responsible person and no address, may be insufficient to meet your obligations under California consumer laws.

    A copy of your company’s announcement and this letter have been sent to the California Attorney General with a letter of complaint about insufficient notification.

    YOUR SIGNATURE
    YOUR NAME
    DATE

  • irishrow

    Perfect. Copied the letter, added some personalization and it’s making its way to San Jose. Thanks for the assistance, net citizens!

  • fizzyd

    Perfect, thanks. I am sending too.

  • http://www.facebook.com/frigginjoe Joe Smith

    I would like to see an ironic class action suit brought on by their terms.