From the THIS REALLY SUCKS (but not in the good way) department:

"As many of you know PayPal has recently changed its user agreement twice. The first change to their user agreement specifically prohibited transactions involving adult items "unless you are completing a transaction on the eBay Mature Audiences site." We (Naughtybids) have been aware of this change and have been aggressively pursuing what we believe to be anti-competitive actions by eBay. Last month Naughtybids filed a lawsuit against eBay alleging that eBay violated antitrust and anti-competition laws by instituting this policy and was trying to further monopolize online adult auctions. After receiving our law suit PayPal promptly changed its policy once again and now will refuse to process payments for all adult auctions (after June 12th) including those completed on eBay's mature audiences section."

more detailes at: Ricks Cabaret Antitrust Lawsuit