Before i go into too much detail, You read the title right. after 2 weeks, petitioning the SEC, FTC, IC3, NW3C, DOJ, and a hand full of state senators and other congress people for support.
I finally got a judge to allow me to file a lawsuit against PayPal, and after complying with the judges request that we send a letter of intent to sue them this week and giving them 2 weeks to reply or resolve the issues. We will be allowed to file a 4 MILLION dollar lawsuit against paypal, and the better news, although we cannot go class action, you still may be able to get in on the action too.
Now a little bit of the back story:
My wife and i both have been long time paypal users, in fact we have done close to 1 million dollars in sales through paypal in the past year alone. I cannot even begin to calculate how much in total over the 7-8 years we have used paypal. We have sold on ebay, sold on craigslist, sold on pretty much everywhere, and sold pretty much anything electronic for years. Never had a problem at all, and thats where bitcoin come in.
I started mining bitcoin a LONG time ago, near the beginning, and have rolled many a coin. In October when Bitcoin was at an all time high, i start doing some numbers, and seeing all these companies selling hardware for bitcoin, figured, well what the hell. i got a ton of it, and if i never use it its really worth nothing at all, so i order hundreds of USB miners, hundreds of blades, hundreds of anything i could confirm legit and take to ebay to join the club of "your and idiot and your going to pay me $695 for a V2 blade" sellers. its almost criminal how many i sold. I sold USB miners, the ever famous 200 GH/s avalon clone miners from china, you name it, i sold it if it was hardware. Never a complaint that resulted in a charge back, in fact the few complaints i got from buyers were pretty legit and dead hardware related, not only did they get their money back, but got a new miner as well. its good for business, and good for bitcoin.
In early december, now selling mainly only bitcoin hardware, out of nowhere i get a limitation on my paypal account. they want documents uploaded, photo ID, proof of address, invoices, what have you. most of it all stuff i had submitted already in the past. at the time they had held hostage, $33,600 3 days of going the rounds with paypal and the limit is raised.
My wife and i promptly transfer the funds out of the bank. Having a bad gut feeling, i contacted my legal team since i have had them on retainer for years and never used them much, and they tell me to just start keeping a record of everything, every phone call, every e-mail, the name of everyone i spoke with, every voicemail paypal left, pretty much everything. so i did, good thing too, the day after, surprise, they put a limit on our account again. right after 8 auctions closed and we had $71,000 and change in the account. same crap, we need ID, blah blah, so i call them, documenting everything, telling them that we already did this just a few days prior.
They get rude, start stumbling around when i keep drilling them as to why again when we already did, the supervisor puts me on hold for about 20 minutes, then comes back on the line and says " There has been a recent increase in activity from your account blah blah we need to wait for delivery conformation" now mind you, our account activity has greatly decreased as we have focused strictly on ebay, and only on bitcoin items. None the less, i document everything, 2 days later delivery confirmation is sent from the USPS tracking numbers.
The funds are released from Ebay, but still limits on the paypal account. So i grab the pen and paper to start taking notes, and call paypal. after going from customer service rep, to supervisor, to specialist, to team lead, then finally to manager over the course of 1 hour 30 minutes with nobody giving me any real information. I HIT GOLD, the manager states, your selling bitcoin. i politely reply, "no sir, i am not, that is against paypals rules, i am selling specialized hardware which is like a computer but designed for one purpose, and that is hashing on a SHA-256 encrypted network", He replies back, well its all the same and bitcoin is direct competition with paypals business model therefore we do not condone, anything bitcoin related. and wouldnt ya know it, smartphones have cool little apps that record phone calls, which i always do so i can take notes later on after the call for the lawsuit i was planning to file.
The next morning i called my lawyer and told him about it. at first he says "you did what? recorded them without their permission?" i said no, they were the ones who told me the call could be recorded or monitored, and i just wanted to make sure it was recorded right. He says, hold on one second please, switches lines, and calls paypals customer service number then 3 ways the call. not even 20 seconds into the call when it is getting ready to switch to a representative, presto there is the call recording disclosure.
Instantly he begins to laugh, and says, well ok, record them all then and we can transcribe them. Needless to say it took a few days and a few dozen threatening phone calls, but we got the funds un frozen. I figured, well that was fun, but back to business. here comes the kicker, 7 hours later i have only 2 auctions close for a total of $8,300 in total.
i print the labels, stop at UPS in the morning and drop off the miners, and before i could even get home. whamo account limitations again. i think to myself. you have to be kidding me, a company cannot suck this bad and still be in business. So i look at what they want this time, and all it says is check e-mail for additional required documentation. so i check our e-mail, and there is nothing at all. so back to the phone. again from CS rep, to sup, to lead to manager over the course of about an hour this time. then put on hold for 43 minutes, and the guy only check in once saying its going to be a few more minutes.
Then a lady ( real bitch of a woman ) gets on the phone and says "my name is blah blah, from the paypal high risk assessment department, we need invoices from your suppliers before we can release the funds, i tell her, "listen lady, we sent an invoice to you already last week for 10 times more machines than we have sold so far dont play that game with me" she then puts me on hold, and says oh, well there was a charge back on your account which needs to be settled before we can lift the hold. mind you i am sitting in front of the computer looking at my screen, not only do we have thousands in the account, but we have NEVER in years of selling had a charge back, and surely not any showing on our account now. So i ask, ok, who, where, when? we have thousands in our account, so unless everyone did a charge back at once, there is no way we are negative, i am looking at my balance now !!!! She says ok we will look into it and give you a call tomorrow. although not satisfied, i was tired, so i hung up. funny thing, 5 minutes later i refresh the page and the account is not limited an more.
This brings us to last week, we made it an entire week and 4 whole smooth transactions through ebay/paypal, not a problem, i had actually thanked my lawyer that monday for his help, and said, hope i dont need you again any time soon. That afternoon we had a few more auctions close. and same scenario, i leave UPS drive the 5 blocks home and in that time, our account gets limited, only of course after i send the merchandise. This time no prevail. $54,600usd frozen as of 12/30, dozens of calls, dozens of BS reasons why they did it, and no resolution option, it says check email for required documentation. By wednesday afternoon my legal team says O.K. this is where we step in, a company cannot hold peoples money hostage because they dont like bitcoin.
And the battle begins, their paralegals transcribe every phone call, copy every e-mail print every screen shot, copy hundreds of complaints from srew-paypal.com and paypal sucks.com. The start blasting it everywhere, writing senators, congress people, filing complaints with the DOJ, the FTC, the IC3, the NW3C everybody pretty much, at the same time the file a petition with the court for a ruling on letting us Sue them in court. The next day the court throws it out.
Then friday comes, and my lawyer calls and says " you have 20 minutes, we need to be at the courthouse" i didnt know what to think, they really didnt either. we get there and this sweet little old lady takes us to a room behind the courtroom and the judge was there. he pulls out a folder from his desk drawer about 3 inches thick it is filled with sheets of paper, and little pick pieces of paper, he then turns his phone around and it is flashing the number 34 on it, as in 34 voice mails. He says "you sure know how to ruin a mans weekend, i dont know who you talked to, but i want to see all of you in my courtroom on monday morning and i will rule on your petition.
For a minute, i really thought i was going to be in some trouble. The lawyers said this is either going to be really bad, or really good, imagine how my weekend was spent this weekend. This morning we arrive 30 minutes early at the court house and the room had like 15 people in it. The judge comes in, sits down, and says " Send them a letter of intent to sue, request that they reply within 2 weeks, if they do not resolve the issue, or reply, i will see this case in my courtroom" !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Guess whos going to sue paypal.
letter of intent gets sent in the morning via US certified mail. Paypal starts to bully bitcoin AND BITCOIN BITES BACK
Now, how does this affect you? well in a lot of ways. 1: if we win, paypal could lose their right to accept credit cards, and face it, what is paypal without credit cards? 2: what is bitcoin without paypal? simple EVERYTHING in terms of funds transfer and commerce. and finally....
3: have you been wronged by paypal yourself? do you have a well documented history of being held hostage by paypal? Well, we now have a pretty good process for you to get revenge, and i am going to start a website that tells you how to do it whether we win or lose in court. In the mean time remember these steps because documentation is everything.
1: take screen shots, make sure your clock is showing the date and time in the picture. anything they put on the resolution center page
2: always print EVERY email. get a folder, a real paper folder, print them and file them, sorted by date.
3: ALWAYS record every phone call, even if your state wont let you use it in court. it is not illegal to transcribe a call. so record it, then get a free software that does text to speech and let it transcribe the call for you. once done PRINT IT and save it. Record the time of the call and the date.
4: If you have to deal in fiat for the time being try and avoid paypal.
5: be sure and keep all your interactions filed neatly, sooner or later you are going to need to file a formal complaint with SEVERAL agencies, authorities, regulatory bodies, and eventually draft a letter of intent to sue.
And there you have it, Hopefully paypal gets everything they deserve in court. How dare they start commiting white collar crimes against people who are "associated with bitcoin"
Bitcoin vs. Paypal
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and bitcoin is going to win
Sorry I just had to split the huge wall into parts.
Your story sounded like what happened to me with PayPal. But I didn't sue. I wished I did now.
