How to Opt out of PayPal's "Agreement to Arbitrate"

Every now and then, companies send out information to their customers updating them on various aspects of things like End User Licensing Agreements and Terms of Service. Most of the time, we just glos over these dry legal documents. But PayPal sent out a notice this morning that not only had me reading it, it had the added effect of really pissing me off.

Under the title of "Notice of Policy Updates" (you may need to be logged into PayPal to access that link), PayPal list what these updates include.

What got my blood boiling was the lines, "You will, with limited exception, be required to submit claims you have against PayPal to binding and final arbitration" and "unless you opt out of the Agreement to Arbitrate you will only be permitted to pursue claims against PayPal on an individual basis, not as a plaintiff or class member in any class or representative action or proceeding..."

In other words, PayPal is trying to abrogate your rights to sue the company in a court of law.

Now, I know a lot of people really dislike PayPal and there have been plenty of horror stories about the company but I've been using them for years and have never had an issue. I don't anticipate ever having an issue. But, if I did, I would certainly want to have at my disposal every legal tool in the book to fight for my right for relief. PayPal is trying to prevent that.

And worse - they are doing it in the typical sleazy way corporations do things.

I immediately went to the PayPal web site so I could avail myself of this opt out and of course, it's not immediately obvious. But here is the clause and information:
Opt-Out Procedure:

You can choose to reject this Agreement to Arbitrate ("opt out") by mailing us a written opt-out notice ("Opt-Out Notice"). For new PayPal users, the Opt-Out Notice must be postmarked no later than 30 Days after the date you accept the User Agreement for the first time. If you are already a current PayPal user and previously accepted the User Agreement prior to the introduction of this Agreement to Arbitrate, the Opt-Out Notice must be postmarked no later than December 1, 2012. You must mail the Opt-Out Notice to PayPal, Inc., Attn: Litigation Department, 2211 North First Street, San Jose, CA 95131.

Yes, that's right - snail mail. I understand the reasoning behind it (the opt out is a legal document and therefore has to be treated the same as other binding, legal documents) but PayPal is certainly counting on many people not going to the bother of doing this. I would encourage you to do it anyway. If you do, ensure you send your opt out letter via Registered Mail so it doesn't get "lost".

William Jacobs, a user on the PayPal site, has kindly created the form for you:

PayPal, Inc.,
ATTN: Litigation Department,
2211 North First Street,
San Jose, CA 95131

This Opt-Out Notice states that I do not agree to the Agreement to Arbitrate.

Name: ____________________________________

Address: ____________________________________

Phone number: ____________________________________

Email address(es) used on Paypal: ____________________________________

Signature: ____________________________________

Your Opt-Out Notice due December 1, 2012 .

Does not make sense

So if this statement is true:
I understand the reasoning behind it (the opt out is a legal document and therefore has to be treated the same as other binding, legal documents)

Why doesn't the same logic apply to the original agreement that I click on?

If I can opt in electronically I should be able to opt out also.

Kevin

You are 100% correct. Paypal

You are 100% correct. Paypal is doing it this way for the reasons stated - they don't actually want people to opt out.
--
Shawn King
Host/Executive Producer
Your Mac Life
http://www.yourmaclifeshow.com

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