California Court Lets Influencers' Class Action vs. PayPal's Honey Proceed

A California federal court denied dismissal of influencers' class action against PayPal's Honey extension.

On June 23, 2026, a California federal court allowed a consolidated class action lawsuit against PayPal to proceed. The case centers on allegations that PayPal's Honey browser extension, which it acquired for $4 billion in 2019, unlawfully redirects affiliate commissions by overriding the affiliate links provided by online influencers.

The plaintiffs, who are influencers, contend that Honey diverts commissions that would otherwise go to them from purchases made by users applying coupons through the extension. This claim challenges the business practices of digital marketing platforms and raises questions about platform liability and compliance risks.

This development follows an earlier court decision in November 2025, when Judge Beth Labson Freeman dismissed a similar lawsuit. At that time, the court found the plaintiffs had not adequately demonstrated entitlement to commissions under their contracts with merchants, stating, "At bottom, the problem with the complaint is that it does not establish the Plaintiffs were in fact entitled to those commissions pursuant to their contracts with the merchants."

In response, the plaintiffs filed a second amended complaint on January 5, 2026, providing specific merchant contracts to better support their claims. The recent court decision to deny dismissal indicates the case has now met the threshold to move forward.

Legal advisers and corporate counsel should monitor this case as it develops, since its outcome could influence compliance standards and risk assessments around affiliate marketing and browser extension technologies.