Reddit beats lawsuit by WallStreetBets founder

Bed Bath & Beyond

11/07/2023 22:52

By Jonathan Stempel
       July 11 (Reuters) - A U.S. judge on Tuesday dismissed a
lawsuit in which the founder of WallStreetBets, which helped
ignite investors' fascination with "meme" stocks, accused Reddit
of wrongly banning him from moderating the community and
usurping his trademark rights.
    Jaime Rogozinski, who founded WallStreetBets in 2012, said
Reddit ousted him in April 2020 as a pretext to keep him from
controlling a "a famous brand that helped Reddit rise to a $10
billion valuation" by late 2021.
    Rogozinski had applied to trademark "WallStreetBets" in
March 2020, when the community reached 1 million subscribers. It
now has 14 million.
    In a 15-page decision, U.S. District Judge Maxine Chesney in
San Francisco rejected Rogozinski's claim that he owns the
WallStreetBets trademark because the market associated it with
him and he made the brand famous.
    She also dismissed Rogozinski's state law claims related to
his ouster, saying either that they were preempted by a federal
law that provides "broad immunity" to websites publishing mainly
outside content, or that he lacked standing to sue.
    Chesney said Rogozinski can try to amend his complaint.
    "While we are disappointed with today's ruling, Mr.
Rogozinski remains confident and committed to vindicating his
rights," his lawyer James Lawrence said in an email.
    Reddit declined to comment.
    It has called Rogozinski's lawsuit a "transparent attempt to
enrich himself," and said it got involved to prevent consumer
confusion, preserve goodwill, and let people in the
r/WallStreetBets subreddit decide who should guide it.
    Rogozinski was seeking at least $1 million in damages.
    Meme stocks gain popularity through discussions, often among
inexperienced investors, in online forums including Twitter.
    Their popularity often leads to volatile stock prices that
do not reflect companies' fundamentals or financial health.
    Prominent meme stocks have included AMC Entertainment
Holdings  AMC.N , GameStop  GME.N , Koss  KOSS.O  and the
now-bankrupt Bed Bath & Beyond  BBBYQ.PK . 
    The case is Rogozinski v Reddit Inc, U.S. District Court,
Northern District of California, No. 23-00686.

 (Reporting by Jonathan Stempel in New York; Editing by David
Gregorio)
 ((jon.stempel@thomsonreuters.com; +1 646 223 6317; Reuters
Messaging: jon.stempel.thomsonreuters.com@reuters.net))