Yesterday we reported that a federal judge in California ruled PayPal's mandatory arbitration policy unfair to customers who complain their accounts are being mishandled. PayPal had attempted to use its arbitration policy as away to head off a class action lawsuit launched by several of its users (Comb v. PayPal).

Referring to the Judge's ruling, PayPal spokesperson Vince Solitto said, "This finding does not address the actual allegations made by the plaintiffs, which PayPal continues to believe to be without merit and will contest vigorously. PayPal strives to provide secure, cost-effective payment processing with outstanding customer service and strong fraud protection for all parties."

eBay announced plans to purchase the online payment service by year end. PayPal shareholders will vote on the acquisition on October 3.