Devin Stone, the popular legal YouTuber behind the LegalEagle channel, has launched a lawsuit against PayPal, alleging that the company’s Honey browser extension has been hijacking affiliate commissions intended for content creators. The lawsuit follows accusations made by fellow YouTuber MegaLag, who exposed the extension’s practices in a viral video last month. Stone, who boasts over 3.5 million subscribers, describes Honey as a “sleeping leech” embedded in users’ browsers, waiting to reroute commissions from legitimate affiliate links to itself.
The lawsuit, Wendover Productions, LLC v. PayPal Inc., was filed on December 29th in California’s Northern District Court. The case accuses Honey of deliberately replacing affiliate links with its own, even when users don’t benefit from a discount. Stone’s legal team, which includes other YouTubers and their businesses, is aiming to hold PayPal accountable for these alleged practices. Additionally, they are inviting other affected creators to join the lawsuit through the website honeylawsuit.com.
How Honey Allegedly Hijacks Affiliate Links
Honey, which offers online shoppers coupon codes through its browser extension, is accused of covertly swapping affiliate cookies. According to the complaint, when users engage with Honey’s pop-up offers at checkout, the extension silently replaces the affiliate links of content creators with its own. This allows Honey to claim credit for the sale, even if it didn’t contribute to finding a discount or providing any other value to the purchase.
Stone’s team also claims that PayPal and Honey employ other tactics to unfairly take commissions. For example, Honey allegedly offers rewards through its Honey Gold program and encourages users to check out via PayPal with the message “Get Rewarded with PayPal.” These practices reportedly allow PayPal to earn affiliate commissions that rightfully belong to creators.
PayPal’s Defense
PayPal, however, denies the allegations. In a statement to The Verge, Josh Criscoe, Vice President of Corporate Communications at PayPal, defended Honey’s practices. He emphasized that Honey is free to use, helps users save money, and follows industry standards like “last-click attribution,” a widely accepted practice where the affiliate link clicked last before a purchase gets the commission.
While the lawsuit acknowledges that last-click attribution is an industry norm, Stone and his team argue that Honey’s use of this practice is deceptive. They claim that the extension tricks users into clicking unnecessary pop-ups that ultimately allow Honey to claim commissions unfairly, without providing real value to the transaction.
The Impact on Content Creators
Stone’s lawsuit underscores that Honey’s practices don’t just harm creators’ earnings in the short term—they also undermine long-term relationships with sponsors. Affiliate commissions are crucial for many influencers who rely on them as a primary source of income. By redirecting these commissions, Stone argues, Honey’s actions erode the value of a creator’s influence, damaging their future business opportunities.
In a video discussing the lawsuit, Stone explained that once a creator’s audience is “infected” by Honey’s tracking system, it can devalue future sponsorships and affiliate partnerships. This has raised concerns across the creator community about the ethics of browser extensions interacting with affiliate marketing systems.
MegaLag’s Exposé Sparks Legal Action
The controversy surrounding Honey gained traction when New Zealand-based YouTuber MegaLag released a video titled “Exposing the Honey Influencer Scam.” In his exposé, MegaLag accused Honey of hijacking affiliate links and replacing them with its own tracking cookies. He also claimed that Honey prioritized coupons from its partner stores, even when better deals were available elsewhere, misleading users into thinking they were getting the best possible savings.
MegaLag’s video provided compelling evidence of significant commission losses for influencers, contradicting Honey’s claims of adhering to industry standards. His investigation laid the foundation for the legal battle now unfolding in court.
Wider Industry Concerns
The allegations raised by Stone and MegaLag suggest that content creators may have lost millions of dollars in potential affiliate revenue due to Honey’s practices. The case has sparked widespread concern among influencers and marketers who depend on affiliate programs to monetize their content. The lawsuit not only seeks financial compensation but also calls for more transparency and ethical practices within the affiliate marketing industry.
