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IMPORTANT UPDATE: Settlement checks were mailed to class members who submitted timely and valid claim forms on June 3, 2011.


A settlement has been given final approval in a class-action lawsuit against eBay Inc. and PayPal, Inc. (collectively, “Defendants”). If you are a member of the binary option broker Class, you must have completed a Claim Form to receive a benefit, or you could have excluded yourself from the Settlement, or objected to it.

The Settlement resolves a lawsuit against Defendants involving claims arising out of representations in the PayPal User Agreement regarding PayPal’s policies and practices for responding to refund requests from those customers who pay for transactions through PayPal using funds from funding sources other than credit cards. The Defendants deny that they did anything wrong. The Court did not decide which side was right, but both sides agreed to the settlement.

Benefits to the Class

You may be a Class Member and could get a benefit if you are a U.S. based PayPal account holder who funded a PayPal transaction on or after February 1, 2004, using a source other than a credit card and who: (i) subsequently requested a reversal of the transaction through PayPal’s prevailing Buyer Complaint Policy and/or Buyer Protection Policy; (ii) did not receive a refund equal to 100% of your transaction payment in response to such request from PayPal or your bank; and (iii) through the timely submission of a Claim Form under oath, attest to a reasonable and good faith belief that you would have received a full reversal of such payment had you used a valid credit card in your possession at the time of the subject transaction to fund the payment and filed a timely chargeback request with your credit card issuing bank. The Settlement provides, among other things, that certain persons who funded transactions through PayPal on or after February 1, 2004 using a source other than a credit card, may be entitled to receive a share of three million five hundred thousand dollars ($3,500,000).

Participating in the Settlement

The deadline to submit a Claim Form was December 14, 2008.

Exclusions and Objections

The deadline to exclude yourself from or object to the Settlement was October 31, 2008. The detailed Long-Form Notice explains the exclusion and objection procedures.

Fairness Hearing

The Court held a hearing on November 17, 2008 before the Honorable I. Leo Glasser, Senior United States District Court Judge for the Eastern District of New York, Courtroom 8B South, 225 Cadman Plaza East, Brooklyn, New York 11201. On April 30, 2009, the Court approved the Amended Settlement as fair, reasonable and adequate and also granted in part and denied in part binary option brokers Class Counsel's fee application.

Please note the following important dates:
Date Case-Related Event
October 31, 2008
Request for Exclusion Deadline (received)
October 31, 2008
Objection Filing Deadline
November 17, 2008
at 10:00 a.m.

Fairness Hearing
December 14, 2008
Claim Form Deadline (postmarked)