Recommended Free Tools
MegaLag’s third video about Honey reportedly alleges that the shopping extension failed to honor affiliate-network “stand-down” rules and could replace another publisher’s tracking ID at checkout. Those claims have not been proven in court. On June 22, 2026, a federal judge allowed a related case to proceed past PayPal’s motion to dismiss because the plaintiffs had sufficiently alleged standing—not because the court found Honey or PayPal liable.
What MegaLag reportedly alleged
A December 31, 2025, report by The Verge said MegaLag’s third video described ways Honey allegedly evaded affiliate networks’ “stand-down” rules. The video also responded to a Reddit AMA by Honey co-founder Ryan Hudson. The report said PayPal had not responded to The Verge’s request for comment at that time; PayPal later gave a response to Hello Partner in January 2026.
The dispute is about who receives credit for a purchase. A creator, publisher, or other affiliate may direct a shopper to a merchant using a tracked link. The complaint in the later lawsuit alleges that Honey could interact with shoppers at checkout in ways that replaced an earlier affiliate’s identifier, potentially shifting commission attribution. That is an allegation, not an established finding that Honey took commissions.
What “stand down” means in this dispute
In the complaint’s account of affiliate-network policies, “stand down” means that an extension refrains from presenting an affiliate offer or changing tracking when a shopper already has an affiliate referral. The plaintiffs allege that Honey did not stand down in some circumstances, including after another publisher’s offer had been accepted. The available sources do not establish that every network uses the same policy or that the alleged conduct has been proven.
Free tools Windows power users keep installed
One-click scans. No signup required.
What the court decided—and what it did not
The case, In re PayPal Honey Browser Extension Litigation, No. 5:24-cv-09470, is in the U.S. District Court for the Northern District of California. In an order dated June 22, 2026, the court denied PayPal’s motion to dismiss the second amended complaint. The plaintiffs had filed that complaint on January 5, 2026, after an earlier version was dismissed for not adequately pleading standing.
The judge concluded that the new complaint sufficiently alleged standing at this stage. It described named plaintiffs’ claimed rights to particular affiliate commissions under merchant contracts and test purchases in which a commission was allegedly received without Honey engagement but not after Honey was engaged. The court was deciding whether the case could proceed, not whether those allegations were true. It did not find fraud or liability.
Rank #2
The second amended complaint also alleges that Rakuten notified PayPal about Honey’s alleged failure to stand down, including in connection with a May 6, 2025 incident, and that PayPal acknowledged replicating an issue and was working on a solution. Those details remain allegations in the complaint unless established through later evidence or a court finding. The court’s discussion of the complaint’s statistical claims likewise does not turn them into independently verified measurements.
PayPal’s reported response
Hello Partner reported in January 2026 that Rakuten Advertising had removed Honey from its network. A PayPal spokesperson told the outlet: “The code causing this behavior has been identified and no longer has an impact. The code was implemented prior to PayPal’s acquisition, and appears to affect less than 0.1% of Honey’s traffic.” The figure and the statements about the code are PayPal’s account as reported by Hello Partner; no independent traffic audit is established in the sources reviewed.
PayPal Ads SVP and GM Mark Grether also told Hello Partner: “We greatly appreciate the partnerships we have with the publishers, networks, and advertisers. We regret the impact this situation has had on our partners and look forward to working together for the betterment of the entire industry.” These comments present PayPal’s position, separate from the court’s limited procedural ruling.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What creators and publishers can take from the dispute
The central issue is whether affiliate attribution was displaced and, if so, in what circumstances. MegaLag and the plaintiffs allege Honey’s checkout interactions could replace an earlier affiliate ID; PayPal’s reported response says the relevant code predated its acquisition and has been deactivated. Neither account is, by itself, a court finding.
Creators and publishers concerned about their own commissions can review affiliate-network reports, merchant terms, and referral records for unexplained attribution changes, and raise specific discrepancies with the network or merchant. The lawsuit does not establish that any particular creator’s commission was lost or provide a verified estimate of the overall financial impact.
Quick Recap
Sources and limits
- The Verge’s December 31, 2025 report covers MegaLag’s third video and the contemporaneous response context.
- The June 22, 2026 court order recounts the allegations and explains the standing ruling; it is reproduced by Justia.
- The second amended complaint is reproduced by CourtHousenews; its factual assertions remain plaintiffs’ allegations.
- Hello Partner’s January 2026 report quotes PayPal’s response and reports Rakuten Advertising’s removal of Honey from its network.
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
