The key to understanding this lawsuit lies in a technical point having nothing to do with the merits of the claims and which appears at pages 35 through 37 of the complaint.
In that section, the plaintiff, Think Computer Corporation, "respectfully requests that Civil Local Rule 3-9(b) be retired, or that Plaintiff be exempted from the Rule given its particular ownership [i.e., owned 100% by one individual] and tax structure [i.e., status as a Sub S corporation]."
The Civil Local Rules are the rules used by the federal court in the Northern District of California to regulate its proceedings procedurally, specifying who needs to do what in connection with the filing and prosecution of lawsuits in this court. These rules have the force of law and litigants who ignore them do so at their peril.
Rule 3-9(b), which the plaintiff asks be "retired," states that a "corporation . . . or other such entity may appear only through a member of the bar of this Court."
In other words, a corporation cannot represent itself in a lawsuit of this type and Think Computer Corporation has filed this action without an attorney representing it while purporting to represent itself in obvious violation of this rule.
A few comments about what I think this signifies:
1. The plaintiff's principal is a spirited individual who has very definite ideas about the money transmission laws and who feels highly aggrieved by the impact that California's 2010 law has had on his company.
2. Those ideas about these laws are, in my view, quirky ones that take significant liberties in interpreting how laws work. In other words, without detailing particulars, I believe that Mr. Greenspan's views of these laws will likely not hold up when tested formally in a court of law.
3. Point 2 above, coupled with the complaint's wild swinging out at multiple parties on dubious theories of liability, is the most probable explanation of why there is no lawyer representing the plaintiff in this action.
4. To sue investors basically for having chosen to fund high-profile startups that the plaintiff deems "unlicensed money service businesses" is flaky and will never hold up. If the action is not bounced for violation of Rule 3-9(b), it will be out the gate as to these defendants on grounds that it does not state a cognizable claim for legal relief.
5. To sue the startups themselves for allegedly providing unlicensed money services is also quite dubious. The money transmitter laws are basically laws that give state governments the authority to require that bonds be provided, that minimum capitalization requirements be met, and that other precautions taken, to ensure that whoever handles escrowed monies takes prudent steps to protect those whose funds are entrusted to them. If these laws are violated, the state authorities have the power to take legal actions to enforce them. Nowhere is there any express private right of action that gives any private citizen the right to file suit complaining about alleged violations of these laws. Therefore, it is a stretch for any private party such as Think Computer to seek damages, injunctive relief, or any other form of legal remedy owing to alleged violations of the money transmitter laws.
6. There are conceivably some legal remedies that might work if the facts support them, one of them being for false advertising claims under the Lanham Act (which is one of the claims asserted here). One competitor can indeed sue another competitor for private damages and other relief if the other competitor is gaining an unfair competitive advantage by falsely advertising that its products or services do something that is material to the customer's decision to use that product or service. Here, the result would turn on the ability to show that the parties sued are in fact engaged in false or deceptive advertising. Even here, however, the case is likely sketchy, in my view, from a quick review of the allegations made.
All in all, this is a most unusual case filed by an unrepresented party that cannot legally represent itself in the forum chosen and resting on legal theories that are a real stretch in most cases. I believe Mr. Greenspan is both sincere and passionate about what he believes but what he asserts is really a case to be made to the legislative policy-makers, not to the courts. There may indeed be incredible unfairness in the way in which these laws are framed and applied. But that does not mean a private party should be able to indiscriminately sue anyone around who happens to be offering services that involve some form of money handling, or their investors, for the results of the existing system. That in itself in not only a stretch but an abuse. Wrong parties, wrong framing. The action should therefore be dismissed forthwith by the plaintiff as having been ill-considered. If it is not, it will be dismissed by the court in fairly short order.
The complaint read more like a screed about everything that's wrong with America than a sincere attempt at obtaining relief.
That said, I'm a little bit sympathetic to the Rule 3-9(b) thing in this context. Even if he was serious, who would take the plaintiff's side of this case on contingency?
As an aside, I think Aaron would make a great plaintiff's lawyer. Combative, self-righteous, with a ton of "burn things down" energy. This is not a negative aspersion on his character--I think it's quite admirable in a way...
Excellent analysis as always, thanks. I was going to facetiously suggest you start billing HN for your services, but I then thought it might be an idea for you to throw a bitcoin address in your profile in case someone feels like sending you a tip.
> Nowhere is there any express private right of action that gives any private citizen the right to file suit complaining about alleged violations of these laws.
I thought California 17200 allows for private citizens to sue on behalf of the general public and that no actual injury against the plaintiff is required. Is there something different about this case?
(below quote and link for other HN readers, I'm sure grellas is familiar.)
"Thus the statutory language allowing actions to be brought "by any person acting for the interests of itself, its members or the general public" effectively deputizes the world to find and bring environmental violators to the bar of justice."
Great synopsis. However, maybe this is more of a publicity stunt? He probably knows the case isn't going to work out in his favor, but perhaps he thinks the headlines will.
I think your explanation is excellent, however I disagree on one point:
"I believe Mr. Greenspan is both sincere and passionate about what he believes but what he asserts is really a case to be made to the legislative policy-makers, not to the courts."
The courts are the place where any man should/can make a difference in the country. For example, I can bring forth a lawsuit to fix something I think is wrong and if my claim is justified the justice system can over rule a governor, state house/senate, or if it makes it federal the President. Also I am pretty sure you can not sue a policy maker so this may be his only option.
Do you think this action has any chance of any positive outcome? I.e. is there realistically any way this could produce any positive benefit for Mr. Greenspan whatsoever?
>>> If these laws are violated, the state authorities have the power to take legal actions to enforce them. Nowhere is there any express private right of action that gives any private citizen the right to file suit complaining about alleged violations of these laws.
What? Why is this the case? Is this the same reason why citizens/competitors/the Sierra Club can not sue BP or Massey Energy for pollution or workplace safety violations? (If 50% of the damages came out of the EPA/OSHA chief regulator's salary I would get behind these suits.) Is there a distinction here between suing the violators than suing the government? Civil suits are for more than contract enforcement, right? What are the general legal terms I should be searching with to learn more?
Qui tam? but that would be more like he was convincing the govt to take up a criminal case and not "I was personally damaged here and here's why I deserve relief"
Perhaps I'm new here, but any chance the title might get 's/Greenspan/Aaron Greenspan/'? I got real confused as to why Alan Greenspan might be suing tech companies...
Even though I'm not a huge Greenspan fan (are there any?), I find this money transmitter stuff incredibly fascinating. I haven't reviewed the relevant legal code, but I strongly suspect that Greenspan is right in that:
(1) there are lots of little annoying laws related to money transmitters that makes it very difficult to get new payment stuff off the ground
(2) If you have deep pockets and good lawyers you can pretty much ignore these laws
I strongly suspect that the correct solution is to change the laws, but that this is also an even greater pain in the ass than protecting yourself with highly paid lawyers, esp. since relevant laws vary significantly from state to state. What exactly Greenspan is attempting to prove here is beyond me, but I'm still quite curious as to the results.
IANAL.. but at the very least, I'd say its poor strategy because the people he's suing (esp. VC funds) are well connected in Silicon Valley.
It looks like he's equating "pass through" transactions with being a (unlicensed) Money Transfer Agent.
Hypothetically, If I was going to start a PayPal alternative, I would figure out a way to stay somewhat compliant.
If that fails, seek a declarative judgement against XYZ agency to get legal clarification, without dragging all the VCs, Angels and unrelated companies into the case.
is the idea that the defendants pursued unfair and illegal business practices, promoting their services, while a law abiding service got swept behind? anyone know what the precedent is for this sort of thing?
"2013-05-08
Order to Show Cause
ORDER TO SHOW CAUSE.
If, by 5/22/2013, an attorney qualified to practice in the United States District Court for the Northern District of California does not appear in this action to represent Plaintiff, the court will dismiss the action without prejudice. No hearing will be held on the order to show cause unless otherwise ordered by the court. Signed by Judge Edward J. Davila on 5/8/2013. (ejdlc1, COURT STAFF) (Filed on 5/8/2013) (Additional attachment(s) added on 5/8/2013: # (1) Certificate of Service) (ecg, COURT STAFF)."
78.
Defendant Yishan Wong, in response to an article authored by Plaintiff on the website Quora, wrote the following comments (among others) indicating his knowledge of payments-related laws and regulations on June 15, 2011:
“Yeah, I am constantly amazed at how people haven’t yet learned that the paymentsindustry is really hard to get into. It was okay for first-wave companies like PayPal to besurprised by it, but anyone who does their due diligence before starting a paymentsstartup should know everyone – literally everyone, including regulators and thegovernment – is going to be working against you. If you can’t take the heat, get out of the kitchen and go start a photosharing startup.”
“Payment startups face a far more adversarial environment, including utter and totalhostility. It was okay for PayPal to whine about this (though they didn’t), because itwasn't known. But now it’s known. If you run a payments startup, you are fightingagainst thugs, actual criminals – both real ones and government ones. It is not normalbusiness. It is like trying to start a business in an actual warzone. Complaining aboutthis is just whining. There is no actual solution than to win. Anything else is, in fact, justwhining.”
Presumably with the hope of “winning,” Defendant Wong proceeded to invest his own personalfunds in Unlicensed MSB Defendant Balanced (part of a $3.4 million seed financing round)
Trying to create political pressure against these "thugs" isn't necessarily a bad move. Let's say you want to start a company which bypasses Taxi medallions. It's in your interest to create a PR storm over the unfairness of the medallion system. It's not OK to be surprised when the entrenched powers try to bite you (though it may not hurt to act surprised). Of course, if you don't have the stomach for it, you shouldn't be getting into the space.
I'm one of the parties to this: I founded ActBlue back in Cambridge before coming to SF and building Meteor.
The funny thing is it came to my house yesterday as a single cover sheet plus a CD-ROM full of files, and I literally don't have a way to read a CD-ROM anymore.
> The funny thing is it came to my house yesterday as a single cover sheet plus a CD-ROM full of files, and I literally don't have a way to read a CD-ROM anymore.
There is something to be said about how in the US it's often best not to contact regulators at all, and to simply fly under the radar for as long as possible.
That said, this guy is seriously toxic. Just by responding to his emails in a friendly manner can get you named in a lawsuit... and to blame competitors instead of regulators... Seems like someone to be avoided at all costs.
The YCFunds share common management and are venture capital funds invested in a number of unlicensed money transmitters.
Can that really hold up? Can an investor be held liable for the decisions of a company they invested in? By that logic, what's to stop someone from suing Facebook shareholders?
The whole reason for this mess is that VCs refused to invest in his "legal" startup (didn't want to waste money on compliance costs?) and invested in a bunch of "illegal" competing companies instead.
It's regulated by criminal law, not civil code. The complaint quotes the law:
"Whoever knowingly conducts,controls, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both."
Presumably if individual Facebook shareholders had real influence over Facebook's actions you could sue them. I would guess the justification here is that YC's partners/etc have a real, tangible influence on the companies they invest in so they do bear some share of the responsibility.
California's money transmission business statute is quite broad:
2030. (a) A person shall not engage in the business of money transmission in this state, or advertise, solicit, or hold itself out as providing money transmission in this state, unless the person is licensed or exempt from licensure under this division or is an agent of a person licensed or exempt from licensure under this division.
. . .
(m) "Monetary value" means a medium of exchange, whether or not redeemable in money.
(n) "Money" means a medium of exchange that is authorized or adopted by the United States or a foreign government. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more governments.
(o) "Money transmission" means any of the following:
(1) Selling or issuing payment instruments.
(2) Selling or issuing stored value.
(3) Receiving money for transmission.
. . .
(v) "Stored value" means monetary value representing a claim
against the issuer that is stored on an electronic or digital medium and evidenced by an electronic or digital record, and that is intended and accepted for use as a means of redemption for money or monetary value or payment for goods or services. The term does not include a credit card voucher, letter of credit, or any stored value that is only redeemable by the issuer for goods or services provided by the issuer or its affiliate, except to the extent required by applicable law to be redeemable in cash for its cash value.
-------
This appears broad enough to include Facebook Credits, bitcoins, etc.
It seems strange to file one suit against a ton of defendants, making it more likely that they will pool resources for defense. Or is that not possible in this context because of the nature of the complaint?
I don't think Greenspan actually cares about winning anything. This is about making everyone play by the same rules -- bringing attention to the fact that California makes it near-impossible for a startup to get licensed as an MTA, essentially shut down his company for trying to get licensed, while all these other startups just ignore the problem and operate illegally.
Can someone please translate this lawsuit into common language. It looks pretty interesting, but I'm not familiar with the laws on money transmission. Thanks!
This group of people knowingly broke the law and profited from it. I chose to obey the law and forgo profits. I would like some profits, hopefully conveyed by legal means, to make me whole.
Probably legal reasons why he won't. Most companies make it a policy not to comment on ongoing litigation. Usually nothing good comes of it. Although there are exceptions...
I'd give my initial opinion based on a first light reading of the complaint, but I'm afraid Greenspan might find a way to construe that as money transmission and add me to the suit.
Pretty weird. On the one hand, there clearly went some effort into this. On the other hand, they are not represented by counsel (p.36), which makes the likelihood of the case being thrown out for procedural reasons regardless of the merits around 99%. All in all I'm leaning more towards publicity stunt...
Like others predict, I think this will get booted because of lack of standing. Interesting that Greenspan makes the broad First Amendment argument about being able to represent his corporation as legal counsel based on political speech rights found in Citizens United.. but that case is not on point and won't help here. The court is unlikely to explain why and probably will dismiss it for reasons Grellas notes in the first comment too. The complaint isn't as long as it looks for non-lawyers - just skim over the parts where he lists all the defendants. After page 37 it's just copies of the laws, regulations and screenshots.
Assuming he hired a lawyer to file his other case claiming arbitrary enforcement of the CA law against his company (discussed in paragraph 4 of the complaint linked to above), that one seems much more likely to go somewhere although relief at this point is pretty unclear.
Also the first time I've noticed someone use "pivot" in the Lean Startup sense in a legal complaint (fn. 3).
On page 35, in order to represent his own company as a non-lawyer, Greenspan appeals for an exception to the rule that his corporation, as the plaintiff, must retain legal counsel. He bases this request on (among other reasoning) the Citizens United decision.
Like Greenspan, IANAL, but I suspect his complaint will die quickly on that basis alone.
[+] [-] grellas|13 years ago|reply
In that section, the plaintiff, Think Computer Corporation, "respectfully requests that Civil Local Rule 3-9(b) be retired, or that Plaintiff be exempted from the Rule given its particular ownership [i.e., owned 100% by one individual] and tax structure [i.e., status as a Sub S corporation]."
The Civil Local Rules are the rules used by the federal court in the Northern District of California to regulate its proceedings procedurally, specifying who needs to do what in connection with the filing and prosecution of lawsuits in this court. These rules have the force of law and litigants who ignore them do so at their peril.
Rule 3-9(b), which the plaintiff asks be "retired," states that a "corporation . . . or other such entity may appear only through a member of the bar of this Court."
In other words, a corporation cannot represent itself in a lawsuit of this type and Think Computer Corporation has filed this action without an attorney representing it while purporting to represent itself in obvious violation of this rule.
A few comments about what I think this signifies:
1. The plaintiff's principal is a spirited individual who has very definite ideas about the money transmission laws and who feels highly aggrieved by the impact that California's 2010 law has had on his company.
2. Those ideas about these laws are, in my view, quirky ones that take significant liberties in interpreting how laws work. In other words, without detailing particulars, I believe that Mr. Greenspan's views of these laws will likely not hold up when tested formally in a court of law.
3. Point 2 above, coupled with the complaint's wild swinging out at multiple parties on dubious theories of liability, is the most probable explanation of why there is no lawyer representing the plaintiff in this action.
4. To sue investors basically for having chosen to fund high-profile startups that the plaintiff deems "unlicensed money service businesses" is flaky and will never hold up. If the action is not bounced for violation of Rule 3-9(b), it will be out the gate as to these defendants on grounds that it does not state a cognizable claim for legal relief.
5. To sue the startups themselves for allegedly providing unlicensed money services is also quite dubious. The money transmitter laws are basically laws that give state governments the authority to require that bonds be provided, that minimum capitalization requirements be met, and that other precautions taken, to ensure that whoever handles escrowed monies takes prudent steps to protect those whose funds are entrusted to them. If these laws are violated, the state authorities have the power to take legal actions to enforce them. Nowhere is there any express private right of action that gives any private citizen the right to file suit complaining about alleged violations of these laws. Therefore, it is a stretch for any private party such as Think Computer to seek damages, injunctive relief, or any other form of legal remedy owing to alleged violations of the money transmitter laws.
6. There are conceivably some legal remedies that might work if the facts support them, one of them being for false advertising claims under the Lanham Act (which is one of the claims asserted here). One competitor can indeed sue another competitor for private damages and other relief if the other competitor is gaining an unfair competitive advantage by falsely advertising that its products or services do something that is material to the customer's decision to use that product or service. Here, the result would turn on the ability to show that the parties sued are in fact engaged in false or deceptive advertising. Even here, however, the case is likely sketchy, in my view, from a quick review of the allegations made.
All in all, this is a most unusual case filed by an unrepresented party that cannot legally represent itself in the forum chosen and resting on legal theories that are a real stretch in most cases. I believe Mr. Greenspan is both sincere and passionate about what he believes but what he asserts is really a case to be made to the legislative policy-makers, not to the courts. There may indeed be incredible unfairness in the way in which these laws are framed and applied. But that does not mean a private party should be able to indiscriminately sue anyone around who happens to be offering services that involve some form of money handling, or their investors, for the results of the existing system. That in itself in not only a stretch but an abuse. Wrong parties, wrong framing. The action should therefore be dismissed forthwith by the plaintiff as having been ill-considered. If it is not, it will be dismissed by the court in fairly short order.
[+] [-] rayiner|13 years ago|reply
That said, I'm a little bit sympathetic to the Rule 3-9(b) thing in this context. Even if he was serious, who would take the plaintiff's side of this case on contingency?
As an aside, I think Aaron would make a great plaintiff's lawyer. Combative, self-righteous, with a ton of "burn things down" energy. This is not a negative aspersion on his character--I think it's quite admirable in a way...
[+] [-] redthrowaway|13 years ago|reply
[+] [-] greatreorx|13 years ago|reply
I thought California 17200 allows for private citizens to sue on behalf of the general public and that no actual injury against the plaintiff is required. Is there something different about this case?
(below quote and link for other HN readers, I'm sure grellas is familiar.)
"Thus the statutory language allowing actions to be brought "by any person acting for the interests of itself, its members or the general public" effectively deputizes the world to find and bring environmental violators to the bar of justice."
http://www.envirolaw.org/Library/17200tools.html
[+] [-] kodablah|13 years ago|reply
[+] [-] mkbrody|13 years ago|reply
[+] [-] lettergram|13 years ago|reply
"I believe Mr. Greenspan is both sincere and passionate about what he believes but what he asserts is really a case to be made to the legislative policy-makers, not to the courts."
The courts are the place where any man should/can make a difference in the country. For example, I can bring forth a lawsuit to fix something I think is wrong and if my claim is justified the justice system can over rule a governor, state house/senate, or if it makes it federal the President. Also I am pretty sure you can not sue a policy maker so this may be his only option.
[+] [-] sillysaurus|13 years ago|reply
[+] [-] thwest|13 years ago|reply
What? Why is this the case? Is this the same reason why citizens/competitors/the Sierra Club can not sue BP or Massey Energy for pollution or workplace safety violations? (If 50% of the damages came out of the EPA/OSHA chief regulator's salary I would get behind these suits.) Is there a distinction here between suing the violators than suing the government? Civil suits are for more than contract enforcement, right? What are the general legal terms I should be searching with to learn more?
[+] [-] personalcompute|13 years ago|reply
[+] [-] larrys|13 years ago|reply
Had that happen a few years ago in a different state. Cost us about $2000 in legal fees and the case was dismissed.
[+] [-] MWil|13 years ago|reply
[+] [-] joewee|13 years ago|reply
Do you represent any of the parties named in this? I think the answer is obvious, but thought I should ask anyway.
[+] [-] ISL|13 years ago|reply
[+] [-] EarthLaunch|13 years ago|reply
[+] [-] Jd|13 years ago|reply
(1) there are lots of little annoying laws related to money transmitters that makes it very difficult to get new payment stuff off the ground
(2) If you have deep pockets and good lawyers you can pretty much ignore these laws
I strongly suspect that the correct solution is to change the laws, but that this is also an even greater pain in the ass than protecting yourself with highly paid lawyers, esp. since relevant laws vary significantly from state to state. What exactly Greenspan is attempting to prove here is beyond me, but I'm still quite curious as to the results.
[+] [-] neurotech1|13 years ago|reply
It looks like he's equating "pass through" transactions with being a (unlicensed) Money Transfer Agent.
Hypothetically, If I was going to start a PayPal alternative, I would figure out a way to stay somewhat compliant.
If that fails, seek a declarative judgement against XYZ agency to get legal clarification, without dragging all the VCs, Angels and unrelated companies into the case.
[+] [-] gluegeorge|13 years ago|reply
[+] [-] unknown|13 years ago|reply
[deleted]
[+] [-] larrys|13 years ago|reply
Not seeing that this has been date stamped by the court...yet. Typically you scribd the stamped copy so you know it has been filed.
[+] [-] apaprocki|13 years ago|reply
"2013-05-08 Order to Show Cause ORDER TO SHOW CAUSE.
If, by 5/22/2013, an attorney qualified to practice in the United States District Court for the Northern District of California does not appear in this action to represent Plaintiff, the court will dismiss the action without prejudice. No hearing will be held on the order to show cause unless otherwise ordered by the court. Signed by Judge Edward J. Davila on 5/8/2013. (ejdlc1, COURT STAFF) (Filed on 5/8/2013) (Additional attachment(s) added on 5/8/2013: # (1) Certificate of Service) (ecg, COURT STAFF)."
[+] [-] soup10|13 years ago|reply
78. Defendant Yishan Wong, in response to an article authored by Plaintiff on the website Quora, wrote the following comments (among others) indicating his knowledge of payments-related laws and regulations on June 15, 2011:
“Yeah, I am constantly amazed at how people haven’t yet learned that the paymentsindustry is really hard to get into. It was okay for first-wave companies like PayPal to besurprised by it, but anyone who does their due diligence before starting a paymentsstartup should know everyone – literally everyone, including regulators and thegovernment – is going to be working against you. If you can’t take the heat, get out of the kitchen and go start a photosharing startup.”
“Payment startups face a far more adversarial environment, including utter and totalhostility. It was okay for PayPal to whine about this (though they didn’t), because itwasn't known. But now it’s known. If you run a payments startup, you are fightingagainst thugs, actual criminals – both real ones and government ones. It is not normalbusiness. It is like trying to start a business in an actual warzone. Complaining aboutthis is just whining. There is no actual solution than to win. Anything else is, in fact, justwhining.”
Presumably with the hope of “winning,” Defendant Wong proceeded to invest his own personalfunds in Unlicensed MSB Defendant Balanced (part of a $3.4 million seed financing round)
[+] [-] wisty|13 years ago|reply
[+] [-] jluxenberg|13 years ago|reply
(1) Think Computer Corporation built FaceCash (https://www.facecash.com/) a mobile payment solution
(2) Aaron Greenspan is Think's President and CEO
Maybe he's trying to get these companies to lobby against "money transmitter" regulation.
[+] [-] debergalis|13 years ago|reply
The funny thing is it came to my house yesterday as a single cover sheet plus a CD-ROM full of files, and I literally don't have a way to read a CD-ROM anymore.
[+] [-] gridscomputing|13 years ago|reply
[+] [-] anonyfuss|13 years ago|reply
This doesn't seem very funny.
[+] [-] nostromo|13 years ago|reply
That said, this guy is seriously toxic. Just by responding to his emails in a friendly manner can get you named in a lawsuit... and to blame competitors instead of regulators... Seems like someone to be avoided at all costs.
[+] [-] rdl|13 years ago|reply
[+] [-] Alex3917|13 years ago|reply
[+] [-] thaumaturgy|13 years ago|reply
[+] [-] yabbadabbadoo|13 years ago|reply
The YCFunds share common management and are venture capital funds invested in a number of unlicensed money transmitters.
Can that really hold up? Can an investor be held liable for the decisions of a company they invested in? By that logic, what's to stop someone from suing Facebook shareholders?
[+] [-] wmf|13 years ago|reply
[+] [-] jacoblyles|13 years ago|reply
"Whoever knowingly conducts,controls, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both."
[+] [-] kevingadd|13 years ago|reply
[+] [-] jstalin|13 years ago|reply
2030. (a) A person shall not engage in the business of money transmission in this state, or advertise, solicit, or hold itself out as providing money transmission in this state, unless the person is licensed or exempt from licensure under this division or is an agent of a person licensed or exempt from licensure under this division.
. . .
(m) "Monetary value" means a medium of exchange, whether or not redeemable in money.
(n) "Money" means a medium of exchange that is authorized or adopted by the United States or a foreign government. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more governments.
(o) "Money transmission" means any of the following: (1) Selling or issuing payment instruments. (2) Selling or issuing stored value. (3) Receiving money for transmission.
. . .
(v) "Stored value" means monetary value representing a claim against the issuer that is stored on an electronic or digital medium and evidenced by an electronic or digital record, and that is intended and accepted for use as a means of redemption for money or monetary value or payment for goods or services. The term does not include a credit card voucher, letter of credit, or any stored value that is only redeemable by the issuer for goods or services provided by the issuer or its affiliate, except to the extent required by applicable law to be redeemable in cash for its cash value.
-------
This appears broad enough to include Facebook Credits, bitcoins, etc.
[+] [-] staunch|13 years ago|reply
FaceCash failed -> Sue Facebook + everyone
Aaron got rich by filing a frivolous lawsuit against Zuck, might as well try it again, huh? This time with even more victims.
Building successful companies is hard, let's go lawyering.
[+] [-] kevingadd|13 years ago|reply
[+] [-] dangrossman|13 years ago|reply
[+] [-] shaddyz|13 years ago|reply
[+] [-] RyJones|13 years ago|reply
[+] [-] unknown|13 years ago|reply
[deleted]
[+] [-] rdl|13 years ago|reply
[+] [-] aidenn0|13 years ago|reply
https://news.ycombinator.com/item?id=5308013
[+] [-] SurfScore|13 years ago|reply
[+] [-] tzs|13 years ago|reply
[+] [-] Atropos|13 years ago|reply
[+] [-] rantee|13 years ago|reply
Assuming he hired a lawyer to file his other case claiming arbitrary enforcement of the CA law against his company (discussed in paragraph 4 of the complaint linked to above), that one seems much more likely to go somewhere although relief at this point is pretty unclear.
Also the first time I've noticed someone use "pivot" in the Lean Startup sense in a legal complaint (fn. 3).
[+] [-] gojomo|13 years ago|reply
Like Greenspan, IANAL, but I suspect his complaint will die quickly on that basis alone.
[+] [-] apaprocki|13 years ago|reply