LegalEagle, a prominent YouTuber and practicing attorney with over three million subscribers, has filed a class-action lawsuit against the coupon extension Honey, a PayPal-owned company. The lawsuit accuses Honey of engaging in practices that allegedly deprived content creators of billions of dollars in affiliate revenue. This legal action follows an exposé by fellow YouTuber MegaLag, published on December 22, 2024, which sparked widespread controversy.
The exposé by MegaLag claims that Honey has been engaging in unethical practices by replacing affiliate links provided by content creators with their own. This allegedly allowed Honey to pocket the commission from affiliate sales that would otherwise have gone to creators. Additionally, Honey is accused of manipulating which coupons are presented to users, favoring their partnerships over securing the best deals for consumers.
These practices, if true, not only harm creators but also compromise the integrity of sponsorships and affiliate marketing. By overriding affiliate links, even those tied to sponsors other than Honey, the platform is alleged to have siphoned revenue away from creators who rely on these commissions as a key source of income.
LegalEagle has taken a firm stance, describing Honey’s business practices as “insidious.” He asserts that Honey’s extension acts like a “sleeping leech” on users’ browsers, quietly redirecting future affiliate transactions to their benefit at the expense of creators. In his words, “Think about how insidious this all was. Honey allegedly seeded those audiences with their extension… and now the creator’s future sponsorships and affiliate relationships were devalued.”
Motivated by these claims, LegalEagle, along with a team of attorneys, has filed a class-action lawsuit to reclaim the money creators have allegedly lost. He aims to hold Honey accountable and prevent such practices from affecting creators and consumers in the future.
The lawsuit, officially titled Wendover Productions, LLC v. PayPal Inc, outlines how Honey’s alleged scheme undermines the “last click attribution” principle that governs affiliate marketing. This principle ensures that the marketer whose link leads to a sale receives credit for the transaction. Honey is accused of deliberately overriding this system to redirect commissions to themselves.
The legal action not only seeks monetary damages but also an injunction to prevent Honey from continuing these practices. LegalEagle has also launched a website, honeylawsuit.com, to invite creators and businesses affected by these alleged practices to join the class-action lawsuit.
This lawsuit sheds light on the broader issue of transparency and fairness in the tech industry, particularly in affiliate marketing. LegalEagle has also questioned why extensions like Honey are allowed on platforms like the Apple App Store and Google extension marketplace, given their potential to harm creators and consumers alike.
As the case unfolds, it could have significant ramifications for the affiliate marketing ecosystem, setting a precedent for how platforms like Honey operate in the future. LegalEagle’s efforts aim not only to secure restitution for creators but also to restore trust in the industry.
This legal battle underscores the importance of safeguarding creators’ rights and ensuring ethical practices in the digital marketplace. For creators and businesses impacted by these allegations, this lawsuit represents a critical step toward accountability and justice.