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PayPal Trying to Divide and Conquer to Avoid Class Action Suits

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Did you get an email from PayPal mentioning their new User Agreement, where they are taking away your right to be part of a class action suit, unless you “opt out” by December 1, 2012? Did you look for a place to click in order to “opt out,” without being able to find it? That’s because the instructions on how to “opt out” are buried deep in the fine print of the user agreement (Section 14.3.3) on the PayPal site. I dug them out and am posting the instructions here, along with an example to copy, so you can protect your right to possibly benefit from a future class action suit.

Yes, we’re all super busy and a million things are tugging for our attention. But, here is one thing worth taking care of, and here are simple step-by-step instructions of how to do it: Opt out of the Agreement to Arbitrate that PayPal has added to its user agreement. Why is this important? Because if you don’t opt out, you cannot be part of any class action suit that might be brought against PayPal. PayPal could rip off millions or billions of people, but you would have to confront PayPal all on your own for redress, unless you Opt Out of the Agreement to Arbitrate before December 1, 2012.
“Amendment to the PayPal User Agreement and Privacy Policy
Effective Date: Nov 01, 2012
(Here’s where they tell you they are taking away your right to win awards as part of a class action suit.)
14.3 Agreement to Arbitrate. You and PayPal each agree that any and all disputes or claims that have arisen or may arise between you and PayPal shall be resolved exclusively through final and binding arbitration, rather than in court, except that you may assert claims in small claims court, if your claims qualify. The Federal Arbitration Act governs the interpretation and enforcement of this Agreement to Arbitrate.

  1. Prohibition of Class and Representative Actions and Non-Individualized Relief.YOU AND PAYPAL AGREE THAT EACH OF US MAY BRING CLAIMS AGAINST THE OTHER ONLY ON AN INDIVIDUAL BASIS AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE ACTION OR PROCEEDING.  UNLESS BOTH YOU AND PAYPAL AGREE OTHERWISE, THE ARBITRATOR MAY NOT CONSOLIDATE OR JOIN MORE THAN ONE PERSON’S OR PARTY’S CLAIMS AND MAY NOT OTHERWISE PRESIDE OVER ANY FORM OF A CONSOLIDATED, REPRESENTATIVE, OR CLASS PROCEEDING.  ALSO, THE ARBITRATOR MAY AWARD RELIEF (INCLUDING MONETARY, INJUNCTIVE, AND DECLARATORY RELIEF) ONLY IN FAVOR OF THE INDIVIDUAL PARTY SEEKING RELIEF AND ONLY TO THE EXTENT NECESSARY TO PROVIDE RELIEF NECESSITATED BY THAT PARTY’S INDIVIDUAL CLAIM(S).  ANY RELIEF AWARDED CANNOT AFFECT OTHER PAYPAL USERS.

(Section 14.3.3) Opt-Out Procedure.
(Here’s where they tell you how to opt out.)

You can choose to reject this Agreement to Arbitrate (“opt out”) by mailing us a written opt-out notice (“Opt-Out Notice”). For new PayPal users, the Opt-Out Notice must be postmarked no later than 30 Days after the date you accept the User Agreement for the first time. If you are already a current PayPal user and previously accepted the User Agreement prior to the introduction of this Agreement to Arbitrate, the Opt-Out Notice must be postmarked no later than December 1, 2012. 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. This procedure is the only way you can opt out of the Agreement to Arbitrate.”

Here are my simplified step-by-step instructions on how to Opt Out, according to PayPal’s requirements.

Materials:
1 piece of paper
envelope
stamp
pen

1. On the piece of paper print out or write this short letter:

(Today’s Date)

To Whom it May Concern,

I do not agree to this Agreement to Arbitrate (Section 14.3).

(Your signature, signed with the pen)

(Your Name, printed legibly)
(The address you have in your PayPal profile. Now is a good time to update your profile, if you want)
(The telephone number you have in your PayPal profile)
(The email address you use to sign in to PayPal)

2. SIGN THE LETTER with your signature in ink.

3. Address the envelope to:

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

4. Put the stamp on the envelope and mail the letter right away.

There! Now you are protected and can be part of a class action suit, should the need arise.

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About Lynette Yetter

Lynette Yetter is the author of the books "72 Money Saving Tips for the 99%" and "Lucy Plays Panpipes for Peace, a novel." Lynette is a permanent resident of Bolivia and a graduate student in the Master of Arts in Liberal Studies Program at Reed College.
  • namaste36

    Adding a delivery confirmation on the sent letter would also be advised. This way you can have proof your letter didn’t get lost in the mail.

  • http://lynetteyetter.com/ Lynette Yetter, author of 72 Money Saving Tips for the 99%

    That’s a great idea, namaste36! Thanks for posting this valuable comment.

  • cp256

    PayPal just $uck$. I sent my opt-out in today. Anyone who uses ebay is virtually forced to use PayPal. PayPal should be forced to integrate other payment services.

  • Igor

    It’s dreadful, but this is the consequence of allowing a monopoly to develop. It’s hard to find a champion to fight this monopoly because there are so many monopolies eligible for legal action.

  • olen