The lawsuit was originally filed in 2010, with the plaintiffs alleging that PayPal and its partner at the time, eBay, had placed inappropriate holds or reserves on sellers’ funds. The organizations were also accused of failing to provide annual error-resolution notices and monthly account statements, as per the terms of the Electronic Fund Transfer Act. PayPal has denied all allegations but has agreed to the terms of the settlement to “avoid the costs and uncertainty of a trial.”
Active PayPal account holders between April 19, 2006 and November 5, 2015 who had a reserve or hold placed on their accounts during that time, or who had their accounts terminated or suspended, may be eligible for reimbursements of up to $440. Only one claim can be paid per account. Qualified users may submit a claim online. At this time, neither PayPal nor the courts have determined the claim filing deadline or final approval hearing.