Paulino (1-0) dominated New York in his first start of the season after sustaining a strained right forearm during spring training. He scattered four hits, walked two and struck out six in the performance.
Butler put the Royals ahead to stay with a two-run double in the first inning and added another run-scoring two-bagger in the fifth as the Royals won for the second time in their-four game set with New York.
Hiroki Kuroda (2-4) was touched for three runs (two earned) on six hits in a 4 1/3-inning effort for the Yanks, who fell to 1-4 in May.
Russell Martin went 3-for-4 with a solo homer for New York.