Opening appellate brief filed to Ninth Circuit in U.S.-based 'Moneymaker' lawsuit against PayPal

Lena Evans Event 22 Day 2 (Image: Haley Hintze)

Posted on: October 30, 2022 14:43 PDT

The opening appellate brief in the U.S. portion of the high-visibility "Moneymaker" lawsuits targeting global online-wallet giant PayPal was filed on Friday in the United States Ninth District Court of Appeals. The appeal, which features Poker League of Nations founder Lena Evans as its current lead plaintiff, challenges a lower-court ruling that dismissed the action and ordered the parties involved into arbitration.

Evans became the lead plaintiff in the case after the involvement of the initial planned lead plaintiff, Chris Moneymaker, was rendered moot by PayPay's unexpected decision to refund a five-digit amount, comprised of entry fees for a DFS (daily fantasy sports) league that Moneymaker ran. Evans and two other litigants, Roni Shemtov and Shbadan Akylbekov, now headline the case.

The matter with Evans as the lead plaintiff runs parallel to a newer action filed against PayPal in Singapore that alleges the same core misdeeds, including unlawful confiscation of users' funds. That class action was filed outside the U.S. to prevent PayPal from shielding itself behind the U.S.'s Federal Arbitration. The innovative Singapore-based action was filed earlier this month and has already drawn more than 4,000 registered plaintiffs from around the world, including some U.S.-based PayPal users who were blocked from joining the Evans-headlined action.

Appellate filing alleges correctable errors by district court

Friday's filing by plaintiffs' counsel, which includes gambling attorney Eric Bensamochan, asserts that the U.S. District Court that ruled in favor of PayPal's motion to force the matter into arbitration acted in error, including that PayPal allegedly never submitted any evidence that the plaintiffs, including Evans, had ever entered into any sort of arbitration agreement with the company. Though "click-box" assents by users during initial account registration may stand as proof of such an agreement to an arbitration agreement, PayPal never submitted any such evidence in the case, and the district court, according to the brief, merely relied upon a filing from an earlier case involving PayPal before dismissing the Evans case.

The appellate brief also reprises some of the core injustices as alleged by the plaintiffs. Those include the assertion that users' accounts were frozen without any specific reasons being offered to account owners, that all funds in affected accounts were eventually seized under the guise of "liquidated damages", and that PayPal arbitrarily granted itself the right to deduct $2,500 from a user's account for any perceived violation of the site's terms of service. Combined with the company's alleged failure to specify exactly how those terms of service were violated, it left the aggrieved users with no effective way to combat or protest the company's seizure of funds.

Referring to a PayPal TOS clause that purportedly mandates all users' complaints be sent to arbitration as "convoluted" and "unconscionable", the opening brief challenged the right of PayPal to appoint itself as its own arbitrator. "This Court must determine whether an enforceable contract even exists," the brief reads. "PayPal’s ability to invoke the arbitration clause of the user agreement constitutes an issue of enforceability which this Court should, in the interest of justice, determine."

Featured image source: Haley Hintze