I think the key here is that they are going to deduct interest that you received from your losses also, which in some cases might reduce or eliminate the chargeoff for a particular loan completely. Personally, I am not going to do the math, but I expect that my estimate of $900-$950 of net chargeoffs will be cut in half or more.
Prosper is paying out $10M to get this thing settled so presumably they are ambivalent how it is divided.
If plaintiffs wanted to divide it based on unpaid principal, would Prosper raise a fuss?
Winners are those who picked loans that went bad quickly, like someone whose portfolio was largely D, E, and HR loans (known to make few payments and go bad quickly).
Losers are those who picked loans that stayed current a long time or those that made recovery payments. (If the borrower pays $100, it reduces the outstanding P&I by $100, but the lender actually got only $73).
If your portfolio was a green circle for a long time, you lose on this settlement and Muleshoes wins.