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[112233]

Has this been discussed here somewhere?

http://www.prosper.com/account/common/agreement_view.aspx?agreement_type_id=8

27. Miscellaneous. The parties acknowledge that there are no third party beneficiaries to this Agreement. You may not assign, transfer, sublicense or otherwise delegate your rights under this Agreement to another person without Prosper's prior written consent. Any such assignment, transfer, sublicense or delegation in violation of this Section shall be null and void. This Agreement shall be governed by the laws of the State of New York. Any waiver of a breach of any provision of this Agreement will not be a waiver of any other subsequent breach. Failure or delay by either party to enforce any term or condition of this Agreement will not constitute a waiver of such term or condition. If any part of this Agreement is determined to be invalid or unenforceable under applicable law, then the invalid or unenforceable provision will be deemed superseded by a valid enforceable provision that most closely matches the intent of the original provision, and the remainder of the Agreement shall continue in effect. The parties agree to execute and deliver such further documents and information as may be reasonably required in order to effectuate the purposes of this Agreement.

LRA, mid 2007 (just to be certain of the change)

21. Miscellaneous. You may not assign, transfer, sublicense or otherwise delegate your rights under this
Agreement to another person without Prosper's prior written consent. Any such assignment, transfer,
sublicense or delegation in violation of this Section shall be null and void. This Agreement shall be governed
by the laws of the State of California. Any waiver of a breach of any provision of this Agreement will not be a
waiver of any other subsequent breach. Failure or delay by either party to enforce any term or condition of this
Agreement will not constitute a waiver of such term or condition. If any part of this Agreement is determined to
be invalid or unenforceable under applicable law, then the invalid or unenforceable provision will be deemed
superseded by a valid enforceable provision that most closely matches the intent of the original provision, and
the remainder of the Agreement shall continue in effect.

http://www.prospers.org/blogs/media/blogs/Fred93/prosper-mid2007-lra.pdf

[Beerbud1]

Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions.[5] Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions.

http://en.wikipedia.org/wiki/Class_action

[112233]

Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions.[5] Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions.

http://en.wikipedia.org/wiki/Class_action

they are still headquartered in san francisco though. did they establish a physical presence in NY somewhere?

[Beerbud1]

Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions.[5] Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions.

http://en.wikipedia.org/wiki/Class_action

they are still headquartered in san francisco though. did they establish a physical presence in NY somewhere?

I don't know.

[Beerbud1]

http://appext9.dos.state.ny.us/corp_public/CORPSEARCH.ENTITY_INFORMATION?p_nameid=3268296&p_corpid=3257077&p_entity_name=Prosper%20marketplace%20&p_name_type=A&p_search_type=BEGINS&p_srch_results_page=0

[112233]

http://appext9.dos.state.ny.us/corp_public/CORPSEARCH.ENTITY_INFORMATION?p_nameid=3268296&p_corpid=3257077&p_entity_name=Prosper%20marketplace%20&p_name_type=A&p_search_type=BEGINS&p_srch_results_page=0

doesnt look like anything has changed. alas, ianal.

[ira01]

http://appext9.dos.state.ny.us/corp_public/CORPSEARCH.ENTITY_INFORMATION?p_nameid=3268296&p_corpid=3257077&p_entity_name=Prosper%20marketplace%20&p_name_type=A&p_search_type=BEGINS&p_srch_results_page=0

doesnt look like anything has changed. alas, ianal.

IIRC, courts tend to enforce choice of law provisions only when there is a nexus between the chosen state and the parties or events involved.  If Prosper has no NY connection other than some NY lenders and borrowers, I'm not so sure that a court would apply NY law to a dispute between a CA company and a lender in another state just because an adhesion contract purported to do so.

[xraider]

Typical Prosper.  Instead of fixing the problem, it tries to create barriers.  But, the barriers are ineffective.

[pioneer11]

Lobby!

[mothandrust]

Please don't tell me that they're going to demur and defer and delay and postpone and then years later the judge says, "Gee, all this has to be done in New York, I don't have jurisdiction" and throws all the multi-colored brief folders into the round file.

[ira01]

Please don't tell me that they're going to demur and defer and delay and postpone and then years later the judge says, "Gee, all this has to be done in New York, I don't have jurisdiction" and throws all the multi-colored brief folders into the round file.

No.  A choice of law provision has nothing to do with jurisdiction.  If there was a valid NY choice of law provision in the applicable legal agreements, that would only mean that a CA court would apply NY substantive law, rather than CA law. 

[xraider]

I haven't seen anything from Prosper asserting that New York law applies to the class action, and it seems to be a new contract term anyway. 

[Beerbud1]

I should explain myself better. Why after 4 1/2 years would they suddenly say that they are now governed by NY law. They are physically located in San Francisco. They are incorporated in Delaware(which is common for Banking and other similiar type corps.)

They recently changed Attorney's ETC.. Although I don't think they are going to suddenly claim that they are governed by NY Law, I do think that their current Corporate Counsel has reviewed lots of things and have made this change in an effort to thwart any and all future potential lawsuits.

[Capital_Finance_Group]

Prosper is still registered in CA (Entity Number: C2632272)
Prosper is registered in NY as a Foreign Business Corportion with offices in CA.

[havastat]

They're using New York law in their contracts because they think it's more favorable.

Nothing to do with their corporate structure.

Don't know if the choice of law clause will always be enforcable. Probably depends.