Comb

ORDER DENYING MOTIONS TO COMPEL INDIVIDUAL ARBITRATION

Plaintiffs seek injunctive relief and related remedies on behalf of a purported nationwide class for alleged violations of state and federal law by Defendant PayPal, Inc. (“PayPal”). PayPal moves to compel individual arbitration pursuant to the arbitration clause contained in its standard User Agreement and the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 , et seq. The Court has read and considered the moving, responding and supplemental papers as well as the oral arguments presented by counsel on August 12, 2002. For the reasons set forth below, the motions will be denied.

I. BACKGROUND

A. Customer Complaints

PayPal is an online payment service that allows a business or private individual to send and receive payments via the Internet. A PayPal account holder sends money by informing Paypal of the intended recipient’s e-mail address and the amount to be sent and by designating a funding source such as a credit card, bank account or separate PayPal account. PayPal accesses the funds and immediately makes them available to the intended recipient. If an intended recipient does not have a PayPal account, the recipient must…