Originally posted 1/13/16. Reposting on 7/31/16 since many people are getting the email from Paypal now about this lawsuit.
Paypal Class Action Lawsuit
Paypal has agreed to pay $3,200,000 in a settlement over claims that it inappropriately froze or closed accounts and another possible $800,000 for certain Claims Members. Paypal denies any wrongdoing but agrees to make the payment to spare expensive litigation.
Plaintiffs allege, among other things, that PayPal improperly handled disputed transactions on PayPal accounts and improperly placed holds, reserves, or limitations on accounts or closed or suspended accounts. Plaintiffs also allege that PayPal failed to provide them with annual error-resolution notices and monthly account statements allegedly required under the Electronic Fund Transfer Act.
Submit a claim form here to take part in the lawsuit.
Who is Eligible?
If you had a hold or reserve placed on your account and/or your account was closed or suspended by PayPal between April 19, 2006 and November 5, 2015, then you are eligible to take part in the lawsuit and you can submit a claim for a cash payment.
Technically, all Paypal members are eligible to join (for what it’s worth), but payment is only to those who had a frozen or suspended account.
How Much Can We Get?
Not much.
| Length of Hold/Reserve |
Hold/Reserve under $1,000 |
Hold/Reserve $1,000 to $10,000 |
Hold/Reserve over $10,000 |
|---|---|---|---|
| 1–30 days | $3.00 | $3.00 | $36.00 |
| 31–90 days | $3.00 | $5.00 | $150.00 |
| 91–150 days | $3.00 | $10.00 | $100.00 |
| Over 150 days | $14.00 | $25.00 | $440.00 |
Let’s assume you had money frozen for 6-months, the Paypal standard, you still won’t get more than $14 for amounts under $1,000 and $25 for amounts under $10,000.
Final Thoughts
Oh my, how I’ve been waiting for this one!
Truth be told, the serious money here is for people who had lots of money frozen in their Paypal accounts. Many real businesses have gotten thousands or millions frozen by Paypal and they’ll get up to $440 out of the settlement. I had (or, rather, have) ~$15 frozen and I won’t get more than $14.
Unsure if I’m actually going to take part in the lawsuit since Paypal has been known to shut down new Paypal accounts when investigating accounts and I prefer to just fly under the radar and leave my $15 frozen in perpetuity.
It looks like this lawsuit is in its initial stages and will probably drag out for some time. For more info, see the FAQ page here.
HT: hindsightwas2020 on Reddit
Well PayPal is still at it!!! My account just got frozen and I’m not sure how much was in there but I’ve been with them since they were around. I’ve done nothing wrong for this to happen but no explanation and no warning. Holding it for 180 days and no transactions can be done anymore. It’s April 2021. Have they just not even learned a lesson..??? No of course not… 3 million is all they had to cough up. That’s like a shake of a hand not even a slap on the wrist!!! This is crap!!!
I want in any class action, paypal says I violated some obscure section of their fair use agreement. That are illegally holding 533.00 of mine for 180 days. In florida you can not legally hold it for more than 10 days and they are far past that
Bastards at PayPal shut down my account, froze over $40,000 of my funds and refuse to give them to me! Not only that, I have buyers awaiting to make payment but can’t due to my status! Unbelievable! This is the whole reason why they are declining.
If I don’t get them to reinstate my account, I will open a lawsuit and have to use stealth techniques with the help of Auction Essistance to get back on and start accepting payments again.
If PayPal froze your funds, and if you couldn’t join Zepeda class action against PayPal, respond here.
There’s another lawsuit right now! You’ll get your funds released!
Please let me know. They are freezing accounts of everyone I know without giving a real reason. Email is [email protected] thanks.
Is there a current class action suit against paypal? They have frozen my accounts yet are still accepting payments for my items on ebay. I can’t pay my bills or buy anything but pay pal can just freeze my money and take what they want? Their claim is they can’t verify my address? Same address i have had since 2007? Paypal sucks! How do I get my money from them?
Hello! I am currently going through a similar situation with PP. They are holding money and I have to wait until May of next year. I’ve been on crazy long hold time 120 minutes plus. I’m looking into what I should do.
Hi my name is Jamie. I am sorry if I am responding very late in the game LOL. I am wondering if there are any current class action lawsuits going on against PayPal by Chance? The reason I am asking is I noticed there was a class-action that settled for 3 million back in 2016 but I was wondering if there are any new lawsuits that I can give my contact information to be included in the lawsuit. Thank you for any information that is given and I hope to hear back from somebody shortly thank you.
When will eBay allow checks/MOs again? They allow it for porn, but not VHS, DVDs, and everything else that’s not? That’s criminal!! And where is the lawsuit about eBay taking 10% on postage? The United States Postal Service should have the Feds raid the place….and yet Obama doesn’t, that bastard.
And, lets not forget PayPal is accepted by all of the on-line digital pirates while Google/YouTube counterfeit all content for free with Eric Schmidt in the Pentagon. That’s why checks/MOs are not accepted, so that fatso Kim Dotcom can live in his New Zealand mansion….oh wait, he can get $440 now.
Trump will fix it, not Crooked Hillary.
Does it mean you can unload PPMC to your checking account now?
I don’t know of any way to do that.
I don’t see why not once it’s posted in the available PP balance. The problem comes only soon as PP notice it; it may depend on regularity but a one time occurence may slide unnoticed. IME, PP compliance department is brutal and you can’t reason with them.
I sent paypal an email asking when my money would be released. Within a few days I received an email stating I could transfer money out or request a check.
How much did you have in there
It was only $125.
Lczar, was you Paypal account frozen? Did they unfreeze it completely or they just let you pull the money out but you still can’t use the Paypal account?
I was only able to withdraw the money. Account is still frozen.
Hmm, interesting.
1)There is no email address to email PayPal with 2) You cannot get the money out because you need to actually log into the account normally to do that to buy the gift card.
Evidently the person whose 2-year-old comment you’re critiquing had their funds frozen but was still able to sign into their Paypal account. Anyone able to sign in can use the “Message Center” to “email” Paypal support. https://www.paypal.com/us/smarthelp/article/how-do-i-contact-paypal-customer-service-faq1920
Launched a Pink Party Event business January 2015. Added PayPal to my wix.com website then watch over $7 million in cart appear then disappeared from PayPal.
It’s got to be spread out I understand but wtf happens you need that money to pay rent and youll be homeless because your rent money is stuck in PayPal
Not uh not satisfied
Get it together PayPal
I’m officially moving on
K thanks
Yea this^ I have been working my ass off for three years starting my own business. Paypal has had my account frozen for 7 weeks now with 8k in it. If I can’t get them to release it in the next week….I’m ruined. Can’t pay my staff wages or continue my business.
What kind of lawsuit is this!!? They should pay more money for the people’s troubles.. Or jail time.. They do the crime gots to do the time.. Same as everybody else.. How is $3 or little more justice? It’s bull****..