LegalEagle Files Class-Action Lawsuit Against PayPal Over Honey Affiliate Practices

Amid the ongoing Honey controversy, prominent YouTuber lawyer Devin Stone AKA "LegalEagle," has filed a class-action lawsuit against PayPal, accusing the company of systematically diverting affiliate commissions from creators.

In the lawsuit, Stone alleges that Honey, owned by PayPal, undermines the affiliate marketing system by intercepting affiliate links and redirecting earnings away from content creators who promoted products.

The popular lawyer, who has about 3.5 million subscribers on his YouTuber channel, described Honey as a "sleeping leech" in users' browsers, waiting to hijack commissions from legitimate affiliate links.

The lawsuit, "Wendover Productions, LLC v. PayPal Inc.," also aims to gather other affected creators to join the legal action through honeylawsuit.com.

In a move that should come as no surprise, creators sued PayPal today in a class action alleging that PayPal interfered with their affiliate commissions by letting Honey steal the attributions. pic.twitter.com/ZjQMRZ5xE6

— Rob Freund (@RobertFreundLaw) December 31, 2024

In an eight-minute video posted on his YouTube channel, Stone emphasized that creators who promoted Honey to their audiences might have inadvertently enabled the extension to compromise their own affiliate earnings across multiple campaigns.

The class-action suit seeks financial compensation for lost earnings and greater transparency in affiliate marketing practices.

While PayPal has publicly denied the allegations, Stone’s lawsuit contends that Honey’s practices not only steal revenue but also devalue long-term sponsorships and partnerships for creators.

"And thus, forever after, the creator’s future sponsorships and future affiliate relationships and advertisements were devalued now that the creator’s audience was infected," Stone said in the video. 

Behind the Honey Scandal

The controversy began when New Zealand-based YouTuber MegaLag released a video titled "Exposing the Honey Influencer Scam." 

MegaLag accused Honey of affiliate link hijacking, where the extension allegedly replaced influencer tracking cookies with its own, diverting commissions away from creators. 

Additionally, Honey was accused of prioritizing coupons from partner stores over better discounts available elsewhere, misleading users about offering the best savings.

Relevant 👇🏼 https://t.co/I0ZNRhmk4Q

— MegaLag (@MegaLagOfficial) December 23, 2024

MegaLag presented examples showing significant commission losses for influencers, despite Honey’s claims of adhering to industry standards.

These allegations suggest millions of dollars in lost revenue for creators, bringing about widespread concern across the influencer community.

This very exposé laid the groundwork for LegalEagle’s lawsuit, bringing the issue into legal scrutiny and, at the same time, showing businesses and affiliate marketing companies the critical need for ethical practices in the sector.

It seems that 2024 ended with controversies that ended in lawsuits.

"It Ends With Us" stars Blake Lively and Justin Baldoni were recently caught in a scandal, with each camp filing their own complaints and lawsuits over allegations of sexual harassment and libel, respectively.