I was thinking "We're rich, sucks to be you.". But lying that the physical presence determines the location of a transaction would be high on the list.
Amazon no longer has an affiliate program in Illinois, despite not having a physical corporate presence there; affiliates in the state were considered (incorrectly, IMHO, but my opinion doesn't really matter) enough of a business presence to tie them here for the purposes of taxation and regulation.
Merchants physically located in Illinois, and directly selling goods, using PayPal to accept funds from Illinois residents and businesses and dispense those funds to Illinois businesses...that's a much stronger argument for tying PayPal to state regulation.
