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This settlement is closed!
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A settlement has been proposed in a class action lawsuit alleging PayPal Inc. improperly handled disputed transactions and improperly placed holds on PayPal Accounts. If you had an active PayPal account between April 19, 2006 and Nov. 5, 2015, your rights may be affected by this class action settlement.
The proposed $3.2 million PayPal class action settlement will resolve allegations that PayPal improperly handled disputed transactions and placed holds, reserves or limitations on customers’ accounts without notice, and in some cases suspended or closed accounts. The plaintiffs claim that PayPal failed to provide customers with monthly account statements and error-resolution notices as required by the Electronic Fund Transfer Act.
PayPal operates an online payment processing service that facilitates payments between buyers and sellers of goods and services sold online. According to the PayPal class action lawsuit, the PayPal User Agreement indicated that upon a breach of its terms, PayPal “may hold funds in a seller’s account by placing reserves on accounts and/or limiting and/or suspending seller’s accounts and holding the funds in the accounts for up to and in some cases exceeding 180 days.”
The plaintiffs, who had used PayPal as sellers, claim that they all had funds in their PayPal accounts frozen for 180 days, but PayPal failed to inform them about the type of activity that triggered the account freeze. Further, PayPal allegedly failed to provide them with an opportunity to remedy the situation and avoid holds being placed on their accounts in the future.
PayPal denies any wrongdoing but agreed to settle the account hold class action lawsuit to avoid the expense and uncertainty of trial. The PayPal class action settlement was preliminarily approved on Nov. 5, 2015.
Who’s Eligible
You are eligible to file a claim for the PayPal class action settlement if you are a current or former user of PayPal in the United States who:
- Had an active PayPal account between April 19, 2006 and Nov. 5, 2015; and
- Had a hold or reserve placed on the account and/or the account was closed or suspended by PayPal.
If this definition describes you, you are a Claims Class Member.
Potential Award
Up to $2,000.
Claims Class Members may elect to make a Basic Claim or an Alternate Claim.
- Basic Claim: If you are a Claims Class Member and you elect to make a Basic Claim, your payment will be determined based on the dollar amount of the longest hold or reserve on your account. These Basic Claim amounts are expected to range from $3 to $440.
- Alternate Claim: If you are a Claims Class Member, you may elect to make an Alternate Claim to seek payment for your actual damages, up to a maximum possible payment of $2,000. If your Alternate Claim is denied, your claim will be treated as a Basic Claim.
Injunctive Relief:
PayPal has agreed to revise its User Agreement and add certain disclosures about its use of fraud and risk modeling. It has also agreed to change its policy with regard to requests for information, and to disclose the reason for a hold, reserve or limitation as long as this disclosure is not inconsistent with PayPal’s security requirements. All Class Members are entitled to this relief.
Proof of Purchase
Claims Class Members must follow the directions on the Claim Form and fill it out completely.
Claim Form
Claim Form Deadline
UPDATE: On August 1, 2016, a second claim form deadline of October 14, 2016 was added for class members who did not receive class notice on or before April 10, 2016.
UPDATE 2: On Nov. 14, 2016, PayPal users urged a California federal judge to grant final approval of a near $4 million settlement over claims the company placed inappropriate holds or reserves on sellers’ funds.
05/10/2016: If class notice was received on or before April 10, 2016
10/14/2016: If class notice was not received on or before April 10, 2016, but was received after this date.
Case Name
Zepeda v. PayPal Inc., Case No. 5:10-cv-02500 SBA, in the U.S. District Court for the Northern District of California
Final Hearing
01/11/2017
UPDATE 3: On November 23, 2016, the court continued the final hearing until January 11, 2017.
UPDATE 4, January 15, 2017: The court has continued the final hearing until February 8, 2017.
UPDATE 5: On March 24, 2017, the court granted the PayPal Account Hold settlement final approval. Let Top Class Actions know when you receive a check in the comments section below or on our Facebook page.
UPDATE 6: On April 17, 2017, an appeal to the PayPal Account Hold settlement was filed. Claims will not be paid until all appeals are exhausted. We appreciate your ongoing patience. Top Class Actions will continue to provide updates as we learn more.
UPDATE 7 on August 22, 2017: The appeals to the PayPal Account Hold settlement have been resolved. According to the settlement website, claims will be paid by October 24, 2017. Let Top Class Actions know when you receive a check in the comments section below or on our Facebook page.
UPDATE 8: On Oct. 26, 2017, Top Class Actions viewers who filed a claim for the PayPal Account Hold class action settlement started receiving checks worth as much as $23.15. Congratulations to everyone who got PAID!
Settlement Website
Claims Administrator
Zepeda v. PayPal Settlement Administrator
P.O. Box 4259
Portland, OR 97208-4259
Class Counsel
QUANTUM LEGAL LLC
LEXINGTON LAW GROUP
FARMER JAFFE WEISSING EDWARDS FISTOS & LEHRMAN PL
SEEGER WEISS LLP
Defense Counsel
STROOCK & STROOCK & LAVAN LLP
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239 thoughts onPayPal Account Hold Class Action Settlement
got a call tonight and the man tried to say that all appeals were solved and there is no known payment date , I told him one of my family members all ready got a check for the $11 and why haven’t I received my $2,000 then he told me he would have to check in to that and get back to me, these people make up lies to cover there self’s, same thing in the home depot we will get back with you… here it is 7 months later, I suppose they want all the money for them self’s.
PayPal is still placing holds on Accounts. I had one from Sept that sat for 30 plus days and I called them and they said I had to contact the seller. I told them the seller cancelled the item over 3 weeks ago and I never got the item. They said there was nothing they could do.
they are still doing this to this day , they closed my account and wont let me touch the money for 180 days. my business is gonna have to shut down until then . thanks paypal
Did anyone get anything?
I am still waiting on a call back from Epic to see where my check is.
nothing here
Nothing again and no return calls
Bad news, if you didn’t receive a check you are not going to get one, all valid (valid according to administrator) were paid Oct. 24. After no return calls I called today and demanded a supervisor and she told me my claims were not valid when matched with Paypal’s records, no correspondence stating a problem or no denial letter. Two accounts, both suspended, (no wrongdoing, just their BS) and funds held 180 days with large sums. We all need to write the judge and hold the settlement administrator and class counsel accountable for this unacceptable sloppy handling of this case.
Not true. I received a letter in the mail October 15, telling me that my claim is valid and to fill out the w-9 and send back. Still waiting on my
Check. I received a call yesterday saying that they got my w-9 and checks could be coming out the next couple of weeks.
somebody like my self should start a class action against the settlement administrator , no check and still never even got my homedepot check either and now they want to play games with this too. I want my 2,000, I will go get a attorney to take it too. because you signed it releasing claims for payments and did not get paid so it don’t apply to you , this is ridiculous
Called settlement administrator four times now and the class counsel and no responses. The 3.2 million settlement was a joke and then you get nothing, Paypal cost me over 20K.
Start a new class action against Paypal and get them to pay a more realistic sum as our claims that we submitted and did not get paid are null and void as we were not paid as the settlement site states ALL CLAIMS WILL BE PAID NO LATER THAN OCTOBER 24!
I live in San Bernardino CA
And I haven’t received anything,so I’m still waiting for my check
Did it come today? I’m in Utah and still waiting too :(
Did everyone receive a irs paper in the middle of October to be mailed back before October 24?
No me.
It was a w-9 for me. Hopefully it means my refund will be more than $11.
Received check in Kansas for $11.57 on 10-30. Thanks for TCA for the continued updates on this case!
Still no check here in eastern North Carolina. I was part of the settlement for sure. I have been selling on eBay since 2002 and did get a notice in the mail. It Is really upsetting to me that I can not reach anyone by phone. We will see tomorrow because the only thing else I can is write them.
No check, 2 accounts, both held funds 180 days, alternate claims filed.
Only settlement administrator who doesn’t have email contact and phone contact is just a recording.
Hey everyone! I got an actual phone number for the class action administrator Epiq. I called and updated all of my information with them so they can reissue my check since I had moved after submitting my claim… (503) 350-5800 they handle numerous of class action suits so let them know it is for Zepeda vs Paypal.
Same…exactly!!
Called the 503 area number, cut off twice, then they said they didn’t have any information on that settlement, said they would have a supervisor call back, no return call, they do business just like Paypal!
Should have received a $2,000 check. Instead, nothing.
10/28/17 Received Check for $11.57 in Missouri.