PayPal is also sued by German merchants

After a class action lawsuit was already filed against the payment service PayPal in the USA, the service must also answer for itself in this country. German merchants are suing the service over account suspensions and withheld money.

German merchants sue PayPal

The payment service PayPal must also answer to the courts in Germany. After several merchants are affected by account blocks and withheld money, a lawsuit was filed. Responsible for this is, for example, the lawyer Fabian Fritsch of the law firm SBS Legal from Hamburg, which according to one of its own reports has already been able to obtain several preliminary injunctions against PayPal.

In a interview with the website Golem.de Fritsch reports on the lawsuits, legal difficulties and the non-transparent procedure on the part of PayPal. Fritsch obtained before the regional court Dresden and the regional court Hanover in each case a provisional order against PayPal.

Both cases concerned the retention of so-called reserves by the payment service, which caused serious financial problems for the firm’s clients. In one case, PayPal also blocked the entire account and “retained an amount of over 200,000.00 euros”.

PayPal simply retains money

According to Fritsch, it is also particularly questionable that PayPal does not pay out the money to the merchants or aggrieved parties after the freezing of the accounts, even after the intended retention of 180 days. PayPal refers thereby to its AGBs, which make it possible from view of the payment service provider to retain the assets as payment of damages and not to disburse also after expiration of the period.

At the same time, merchants lose access to the payment service when the account is cancelled, which is another major problem. “The service is often used for 70 percent of the orders received from online customers for payment processing at the merchants, sometimes even to more than 90 percent, if Paypal-Plus is used,” reveals Fritsch in the interview.

In cases of the notice and retention of so-called reserves, affected merchants can sue or obtain a temporary injunction. The latter, however, must be made within one month. The advantage, however, is that a decision can be reached within a few weeks.

The chances of success depend on the individual case. According to the lawyer the chances stand majority however well. “Therefore, we have already obtained several successful injunctions, with which the dealers could get their money back.”