Posted: January 17, 2022, 12:23 p.m.
Last update: January 17, 2022, 2:39 a.m.
Two-time World Series of Poker Circuit ring winner Lena Evans is suing PayPal. In a RICO lawsuit filed Thursday in federal court in Northern California, she accuses the digital payments giant of “fraudulent, oppressive and malicious conduct.”
In the proposed class action, Evans says PayPal froze $26,984 in his account without warning or explanation.
She uses the account to help run her non-profit organization, the Poker League of Nations (PLON). This raises funds for women with various needs, according to the lawsuit. These include female veterans, women with breast cancer and those facing child care issues.
Evans also uses the payment processor to exchange money for a poker league she owns and runs, Helix Poker, and to buy and sell apparel.
“Pure and Simple Theft”
Evans is the lead plaintiff in the lawsuit which includes two other businessmen, who say they also violated PayPal’s “Acceptable Use Policy (AUP)”, without explaining why.
The plaintiffs say PayPal’s practice of seizing money under this policy is “unlawful, highly questionable, and akin to outright theft.”
The AUP itself is not included in Paypal’s User Agreement, but is a separate document that users should access via a hyperlink on its website. It prohibits the use of the platform for various illicit activities and states that PayPal can seize certain funds for “damages” when detected.
The plaintiffs say they did nothing wrong. While poker tournaments are illegal in some jurisdictions, Evans tournaments are held in licensed and regulated casinos in the United States. Meanwhile, his fellow complainants are not involved in the gaming industry at all.
These provisions explicitly allow the defendant to collect damages only for violation of the AUP – and not merely an alleged violation or an alleged violation,” declares the lawsuit. “Furthermore, even in the event of an actual violation, users are expressly liable to defendant only for defendant’s ‘damages’ caused by such violation.
“Nevertheless, Defendants routinely engage in “self-help” under the guise of this provision by withdrawing money – sometimes entire account balances – from its users’ accounts and transferring those funds to them- even based simply on alleged or alleged violations of the AUP”, it continues.
According to the lawsuit, PayPal does so without conducting any “reasonable investigation” to determine whether a breach occurred. Often it does not even contact the user before the funds are seized and offers no reasonable means for users to dispute the action or obtain due process.
Evans was likely inspired to file the case by Chris Moneymaker, the 2003 WSOP champion and Poker Hall of Famer. Moneymaker took to Twitter in June to complain that PayPal froze more than $12,000 it intended to use as buy-ins for fantasy football tournaments.
He threatened to sue and demanded to hear from Twitter followers with similar experiences. There was a lot.
However, the lawsuit was apparently dropped after Moneymaker’s funds reappeared in his account ten days later.
Evans and his co-plaintiffs appeal to the lawyer the former world champion briefly hired, Eric Bensamochan.
In addition to racketeering, they accuse PayPal of unjust enrichment, violation of federal electronic funds transfer law, breach of contract, and violation of various California state laws.
They are seeking three times the amount seized by PayPal in increased damages, plus punitive and exemplary damages, as permitted by law. They also want the court to order the company to cease and desist from engaging in “unfair, illegal and/or fraudulent business practices” described in the lawsuit.