PayPal Seeks Class Action Lawsuit Against PayPal

The upcoming class-action lawsuit against PayPal will be the target of intense criticism coming from both sides of the aisle in the United States, and from within the company itself.

The lawsuit, which has been lodged by hedge fund billionaire Peter Thiel, is expected to be the first time that an iconic corporation has been targeted in this way. However, there is already a wealth of information on this lawsuit and on the class action lawsuit itself that anyone interested in investing in digital currencies should know. For example, Thiel and his partner Balchin filed suit against PayPal, saying that the company did not protect its intellectual property interests appropriately when it acquired PayPal from eBay founder and owner Bob Thiel. In addition to that, the lawsuit claims that PayPal acted unethically in selecting an IP-focused venture capital firm to invest in the company’s assets.

Several commentators have criticized this class action lawsuit against PayPal as being too expensive, claiming that a lawyer can only reasonably charge about $300 for filing a complaint.

While there are certain costs associated with filing such lawsuits, there is also considerable cost in defending those lawsuits if they are successful. As we have discussed in prior articles, plaintiffs in securities cases often obtain more damages than the defendant pays, since the defendant is usually shielded from such costs by prevailing statutes of limitations. However, in this case, PayPal does not have the standing to defend against the complaint, as it was not a party to the underlying transaction. Consequently, unless there is some evidence that PayPal is guilty of acting in bad faith, the plaintiffs’ complaint may not survive even if it is advanced by a strong attorney.

There are several plaintiffs’ attorneys who have raised the possibility of a PayPal-versus-defendant class-action lawsuit against PayPal during the summer of 2021.

The majority of these discussions centered on the threat that plaintiffs might obtain a large judgment against PayPal, in which case it would become imperative for them to seek the advice of a Las Vegas litigation attorney who specializes in litigating Internet litigation. One such discussion included an expression of support from PayPal itself, in which the company’s counsel stated that “The reality is that the customer service issue, while legitimate, was not contemplated in our agreement and ultimately was not an issue in the transaction.” (emphasis added).

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