Punch drunk after-party capitalism (that's capitalism well after late-stage): where the whim of one rich dude is more important than the entire rest of the world.
Hey, wait a minute... What if it's not Google that's the problem. What if...it's the entire industry that made Google think it's a good idea to put AI front and center? What if...it's Sam Altman and generative AI itself?
That would be super uncomfortable for someone like, you know, Paul Graham.
Translation: Omar doesn't like that the process server almost got him at his parents' house in LA where he's hiding—which wouldn't be necessary at all if he just showed up in court.
Just a guess... But it appears that Kyle Corcoran is the Morgan Stanley Managing Director who helped Elon Musk manipulate the market to amass his Twitter stake.
The name lines up.
And so does the timing. It looks like Morgan Stanley likely fired him in 2023 when this came up in discovery.
Kate Claassen's name also fits, and she has a work background at Merrill Lynch (as does Birchall), but unlike Corcoran, she still appears to be employed at Morgan Stanley.
10 years, $23M in attorney's fees and 1 dead kid later, the federal courts have washed their hands of their PACER fee problem. Lawyers and judges stole from the public—directly—killed a friend of mine, and just gave themselves a 3.96X lodestar bonus for doing it.
I have to say, I don't fully understand why Elon decided to release this video. In my view it proves, or at least strongly supports, the case against him that the WSJ (or the Tesla Board via WSJ?) was trying to make.
Today I was just revisiting the bizarre fact that I was banned from Reddit's /r/technology sub-Reddit on March 15, 2023, despite not having posted anything there for over a year at the time. It just showed up out of nowhere: hi there, you're banned. Kind of bizarre.
Even if no one sees this, I'm really glad I have control over this platform.
If you're interested in how Silicon Valley regulators evolved to allow virtual currency (bitcoin) startups to do whatever they wanted while cracking down on responsible players using only USD, here are two videos from 2013 I dug up:
Jay Powell is the cool dad who wags his finger and then leaves behind a big cooler full of alcohol, cocaine and meth for the kids when he goes on vacation.
Today, in violation of federal law, OpenAI's security physically shoved me out the door because I requested a public record: the non-profit's most recent tax return. Fortunately I wasn't hurt. The company also threatened me with criminal charges.
So one thing that has been bugging me about the Big News is that it doesn't make any sense. Company has disagreement with star CEO, decides to part ways. But 30 minutes before the close of trading on a Friday? Sending the NASDAQ down? Surprising Microsoft?!?! Come on. Something is up.
There are only two things that can make a corporate board of directors react suddenly like someone just poked them in the eye: a real threat of criminal penalties or proof of financial fraud.
In this case, if you look beyond the mainstream coverage, there's evidence to suggest both. First, the suggestion of financial issues comes from a pseudonymous user on Reddit.
But then there's something else. OpenAI, Inc. is a non-profit organization that is required to be, and is, registered with the State of California Office of the Attorney General, which manages tax-exempt organizations. Its exemption was granted on November 15, 2017 at the state level.
You're supposed to file a Form RRF-1 each year four months and 15 days after the end of your accounting period. So if you're on a standard calendar year accounting cycle, that means May 15th. Except that OpenAI has been filing six months late each year since 2018 for some reason.
In 2021, they filed on November 18th. In 2022, they filed on November 17th.
Hey, yesterday was November 17th! How weird!
My theory is that a lawyer got extremely nervous around question 2 on Form RRF-1, which should have been filed yesterday. According to the California AG at least so far, it wasn't.
Firing Sam makes a lot of sense if you sit on the OpenAI Board. Sure, the organization could lose its tax-exempt status, and that would be bad, but the California AG could also sue you for breach of fiduciary duty, or worse, if there's real financial fraud, start filing criminal charges.
This is the kind of risk mitigation strategy intended to reduce a Full Clusterfuck to a Slap On The Wrist.
(And most employees, who are not lawyers, would probably not even be aware of it.)
Cute. It's definitely been more than a "couple" of days. Not that I think that's a true or valid excuse for prohibiting anyone from cancelling a subscription.
Internet advertising is such a hilarious boondoggle. United wasted 100% of its money paying for these banner impressions aimed at me. Yes, I did start booking a trip to Chicago on the United website. Yes, back in the 1990s, it was thought that it would be miraculous if you could specifically target customers who left something un-bought in their shopping carts. Maybe just reminding them in an ad would compel them to finish the transaction! The only problem?
I did. I booked the trip to Chicago. Just not using that same shopping cart. I booked my ticket to Chicago in a new browser session probably because the first one expired, or I wanted a different time, or I wanted to use credit card points, or who knows. But I definitely have a ticket to Chicago, on United, and I'm not going to click on the ad to buy a second one. Thanks anyway, though.
Some of the FBI documents disclosed require a bit of reading between the lines to fully understand what's being said.
For example, when the FBI says "this investigation should be reclassified as a 245 matter," what that means is that it's a big enough deal that the Organized Crime Drug Enforcement Task Force (OCDETF) should consider it related to "Central/South American Organizations" or "Other Major Criminal Organizations." See https://oig.justice.gov/reports/FBI/a0439/app7.htm.
A flight certificate issued in Comic Sans MS with a PowerPoint ClipArt shape for a seal. Where were the signs?
Example no 1,055 of why Nigeria has no actual elite to speak of, but rather a bunch of rich dunces who think at the exact same level as your average Rafiu at the mechanic village in Ojokoro:
The Hawker 800XP aircraft with the tail identifier 5N-AMM and serial number 258286 that… pic.twitter.com/iXOUO5eZGY
So I didn't really want to do this, but the United States Department of Justice isn't being very cooperative, and circumstances have shifted a bit.
In my FOIA lawsuit over records involving Bola Tinubu, who supposedly won the Nigerian presidential election, the IRS previously responded by stating that records were exempt from disclosure because they might be considered tax information. That sounded kind of ridiculous because in the 1990s, one of the many federal crimes that Mr. Tinubu committed was failure to file a tax return. So I pressed the matter.
After I filed my lawsuit, it turns out the IRS conducted a pretty thorough search for records and didn't turn up anything because the agency has record retention policies to prevent the entire country from drowning in paperwork. (The IRS's computer systems are very old; much is still handled on paper. Long story.) I had a phone call with the IRS attorney and USDOJ attorney about this earlier in the month, and the IRS attorney e-mailed me a declaration from another IRS attorney explaining how the search was conducted. That looked fine to me, but it was kind of strange because the declaration wasn't signed, it was a draft, and it was being provided in an e-mail to me that wasn't filed with the court.
I asked the lawyers to please file a signed version with the court. They hemmed and hawed and said they weren't sure how to do that properly—even though it seems fairly obvious—and in any event, didn't follow through.
Then the Nigerian Supreme Court moved up the date of the election hearing to *Monday*, October 23rd, three days from now (!), very likely to front-run the release of any FOIA documents.
We still don't have any FOIA documents from the federal agencies, but we do have this random IRS declaration about the documents they *don't* have. So I think in the interest of transparency, even though it's not officially on the docket like I asked for it to be, it should be out there. It at least reiterates that Mr. Tinubu was under investigation.
If a signed version gets filed on the court docket later on, everyone can just disregard this document, and I may actually delete it. I don't want a draft declaration posted due to government sloppiness to confuse anyone.
So contrary to all of the reporting in Nigerian media right now, Bola Tinubu has not officially filed any motion to do anything regarding the FOIA requests I filed about him. It's true that his attorney did file an appearance on his behalf to intervene. And it's also true that a motion will be forthcoming most likely. But it hasn't happened yet! So it's a bit strange to keep reading that it has.
The Nigerian media has covered the controversy over his Chicago State University diploma in a similarly confusing manner. Yes, he forged the diploma. He probably couldn't find it and needed to show something that suggested he graduated. But the records show that he was there and that he did receive a diploma. So while his dishonesty is noteworthy, that doesn't mean he never attended or graduated from the institution.
Today, in an article about Carvana Co. (CVNA) earnings—which were moved suddenly last night from early August to this morning, before market open—CNBC neglected to mention what Bloomberg referred to as a $1 billion share issuance. From a share price perspective, CNBC covered the positive, which was that Carvana had restructured part of its debt, but apparently glossed over the negative, which was that existing shareholders would be diluted.
The information about the share issuance was stated in the SEC forms filed by the company, but not in its press release. This isn't too surprising because Carvana Co. (CVNA) is run by a convicted felon and his son. Also, they sell used cars. Any reasonable person, let alone journalist, might be skeptical and on guard especially given the late-breaking change of earnings announcement and the fact that the internet was abuzz last night with rumors of new shares being issued.
I pointed this out to the reporter on the article, Mike Wayland. At 5:27 A.M. PDT, he said, "Thank you for the email. You are completely correct, that should be in there. Was unfortunately distracted with another editing problem and missed that. It is being updated now." This was about an hour-and-a-half after the news broke, and Carvana Co. (CVNA) stock was up 35% and climbing. When I pointed out that there should be an alert to offset the first alert containing the omission, he balked, stating, "articles are frequently updated as information becomes available."
The problem is that the information was available when Mike wrote his article. He just didn't bother to do any research.
Presumably Mike's billion-dollar editing error is fixed now. But it's not clear that it matters; the damage is done.
On Thursday, July 13th, CNBC published a headline suggesting that Ripple had sued the SEC and won a victory. No. The SEC sued Ripple. Which makes things slightly different. I've talked about why that order is a logical disaster elsewhere. (So has Matt Levine, who practically wrote a book about it in his newsletter for Bloomberg.)
Then, on Friday, July 14th, CNBC reported that the FTC's Ninth Circuit appeal had been denied—in a day. The headline was basically accurate, that the "bid," meaning "motion," for a preliminary injunction had been denied. But denying one motion in an appeal is a very different thing than denying an entire appeal.
Fortunately, CNBC corrected both of these problems after I explained them. But come on guys.
Judge Torres basically says a few things that are deeply concerning, no matter what you think about cryptocurrency:
1. She says that depending on how closely investors read disclosures, that might affect whether something is a security. (What?)
2. She says that it effectively might not be possible to regulate algorithmic trading of securities because the things being traded might not be securities since the computers don't read the disclosures. (What?)
3. She says that what the SEC describes on its website as "essential managerial efforts" of a token don't matter as far as "profits derived from the efforts of others," and therefore XRP isn't a "investment contract" under certain circumstances. (What?) So I guess that if Ripple went out of business and XRP could keep trading as usual, she might have a point, but it doesn't seem to me that it would in that eventuality. *See* every other crypto token that halted trading after an implosion.
Naturally, social media and too-quick-to-publish-because-they-want-to-be-first reporters are totally misinterpreting this ruling, which also has a footnote on page 23 stating, "The Court does not address whether secondary market sales of XRP constitute offers and sales of investment contracts because that question is not properly before the Court." Thank god, because this Court clearly isn't particularly well versed in anything securities related.
The fundamental flaw in Judge Torres's reasoning regarding the Programmatic Sales portion of her ruling seems to be A) that she is interpreting Howey's third prong, that an investor "is led to expect profits solely from the efforts of the promoter or a third party" (on page 11 of the ruling) to mean that the profit has to be based on the work on the *specific* promoter of the security, in this case, Ripple. That's not what it says.
In this case, the third party (or in reality, many parties) would be everyone else buying the tokens. That's because cryptocurrency is a giant Ponzi scheme. With no inherent value, everything rests on Greater Fool theory, i.e. you hope that someone else is foolish enough to pay more for the worthless token than you did. So investors absolutely put their money in hoping to "profit[] solely from the efforts of the promoter or a third party." The precedent, which by the way is from 1946, says nothing about the role of a company like Ripple specifically.
Judge Torres also compares XRP tokens to a horse or an automobile based on other precedent, saying that people might not expect those things to appreciate in value. The analogy is ludicrous. There has at no point been a globally distributed network of people trying to pump up the value of a given car or horse, or even type of car or type of horse.
It seems pretty clear she didn't talk to any experts in the field before writing this one. Yikes.
I am going to start documenting all of the errors I find on CNBC.
CNBC is a really important media outlet and crucial resource for public markets. But the frequency with which it posts misinformation is just astonishing, and that's not even counting the infamous Jim Cramer, who I'm embarrassed to say graduated from the same school I did.
So here's a story from a few days ago. Coinbase Global, Inc. (COIN) filed an Answer in the SEC's lawsuit alleging that it had sold unregistered securities. CNBC reported, both on its website and in a video segment, that Coinbase Global, Inc. (COIN) had asked the court to dismiss the lawsuit. That wasn't true. If it had, it would have filed a Motion to Dismiss, effectively the opposite of an Answer. The video segment even said that Coinbase Global, Inc. (COIN) had asked for dismissal even as the graphic displayed showed the document filed, which clearly said "Answer" on the first page. Apparently editors don't know the difference, which is concerning.
Today, reporting on a confusing court order on summary judgment in the SEC's lawsuit against Ripple, CNBC reported "The news marks the end of a three-year battle between Ripple and the Securities and Exchange Commission, which initiated a lawsuit against the company in 2020 for breaching U.S. securities laws by selling XRP without first registering it with the agency." See https://www.cnbc.com/2023/07/13/xrp-surges-after-judge-delivers-a-huge-win-to-ripple-in-its-case-against-the-sec.html. That's also not true. The court order says a trial will be scheduled, so the case is ongoing.
If you've followed me on Twitter, you know that I am rather skeptical of Tesla's undefined "deliveries" metric. So here's what actual vehicle registrations look like in New York as of yesterday.
It's not at all clear why they're even manufacturing the Model S and X anymore. Barely anyone buys them and the reliability of the Model X in particular is abysmal.
Elon did not respond. I sent his attorneys two polite warnings about default. He still did not respond. His attorneys also did not respond (they're also cross-defendants), which is consistent with what they previously told me: they believe there is no lawsuit at all.
As described above, they believe there is no lawsuit because the court lacks jurisdiction given that they dismissed their claims voluntarily on May 1, 2023. I didn't file a cross-complaint until May 3. By their logic, the court had no authority to issue summonses on that cross-complaint because it was filed after.
Well, I thought about it. And I realized that even if you agree with Elon's lawyers' reasoning, he's still wrong. That's because California law bends space-time.
There's this thing called California Code of Civil Procedure § 1010.6(a)(3)(B).
It says anything electronically served gives the other side two extra days to respond. So basically, filing two days later is like filing on the same day—or maybe even earlier on the same day.
Guess who served the request for voluntarily dismissal electronically?
Now guess who got two extra days to respond?
And guess who responded exactly two days later?
(Answers: Elon, me, and me.)
Suffice it to say that Elon's strategy here is interesting.
He filed the initial [CA state] lawsuit, which means that there was no need to serve a summons on him for the cross-complaint. He was served the Cross-Complaint electronically on May 3rd and the First Amended Cross-Complaint electronically on May 15th.
After his lawyers received the Cross-Complaint they tried to revoke their agreement to receive e-mail service, but as I pointed out, that was unethical, a violation of California law, a violation of State Bar Rules, and a violation of the Local Rules of the Superior Court of Alameda County.
Oops.
And then I added a claim for abuse of process involving those violations (and others) to the First Amended Cross-Complaint, and served that on Elon via his Hardcore Litigation Department on the 15th.
They get 30 days + 2 for electronic service (because California law makes no sense).
So May 15 + 30 days = June 14 + 2 days = June 16 = tomorrow.
Normally when someone has a jurisdictional argument like the one Elon's lawyers are now making they file that in a motion to dismiss, or in California, a "demurrer" as they call it.
Will they file anything? Or is there no need because the case is so closed and the summonses are invalid and the service is inapplicable and no court can contain the great Elon Musk and I'm so hopelessly wrong and in need of legal counsel as they keep reminding me?
We shall see!
(One hint: under California Code of Civil Procedure § 430.41, if you intend to file a demurrer, you have to "meet and confer" "in person or by telephone" at least five days before. They haven't done that, and have expressed no interest in doing so. Last time they had to it didn't go so well.)
It's rather odd that there has been what I would call a modest degree of concern over the simultaneous Twitter suspension of my business and personal accounts, for which I'm thankful, but nearly no media coverage of the only *lawsuit* Elon ever filed against any person—me—earlier this year.
Soon after I wrote about it, it was dismissed. The main reason why is that it was essentially a derivative of another lawsuit filed by a different critic of Tesla, and that underlying case settled. But it settled on the very day the grace period on my motion for sanctions against Elon ran out. So.
Once Elon's lawsuit against me was officially voluntarily dismissed, I filed a counter-suit alleging that Elon and his lawyers had engaged in malicious prosecution and abuse of process, not to mention libel and a number of other legal violations. (Again, not a peep from the media.)
I waited until after it had been dismissed because California law *requires* the suit that you're alleging was maliciously prosecuted to have been completely dismissed before you can file your claim. But this is kind of weird, because you don't normally file a cross-complaint *after* dismissal.
There's no law that says you can't. And the court accepted it. And then the court issued summonses on my cross-complaint. But Elon's lawyers took the position that because their complaint had been dismissed, the court—which they chose—no longer had jurisdiction. Case closed, they said.
Well, it's not quite that simple. Courts retain some jurisdiction post-dismissal to handle things like determining attorney's fees. And there is an exception in California caselaw for...wait for it...cross-complaints. Which is exactly what I filed.
So Elon & Co.'s position was that I couldn't hold him to account for his frivolous and malicious lawsuit before it was dismissed—California caselaw says so—and I couldn't hold him to account for his frivolous and malicious lawsuit after it was dismissed. Does anyone see the problem here?
Fortunately, there is a case called Loomis v. Murphy (1990) 217 Cal. App. 3d 589, 593-595, which basically says I'm right. In the court's words, "we find no reason for permitting the separate filing of such an action and yet prohibiting it as a cross-complaint."
So who cares about all of this? Well, I've been fighting Elon in court for three years with both hands tied behind my back. Hand 1: no lawyer. Hand 2: no discovery.
This lawsuit means I get discovery. Right now.
So Elon and his lawyers probably do not love that idea.
They shouldn't.
I don't know why my Twitter accounts were suspended today, of all days. I've been writing publicly—and as far as I know, accurately, I might add—about what Elon is really up to since 2018. But this context may matter because I don't think it's the kind of thing he wants people to be talking about.
My lawsuits get to the heart of why Elon is actually so wealthy. They ask the questions the media has failed to ask and force him to address the allegations that could undo his net worth.
For the cost of a sheet of paper, a pencil, an envelope, and a postage stamp, you can request that the court seal your case permanently. You can even use PlainSite to search for motions to seal that have worked well in the past, so you know how to be...
Trademark owners lose their rights when they stop using their trademarks for a prolonged period of time. Why should patents be any different? There is something to be said for the conventional time-limited monopoly, but there are so many abuses of th...
Fortunately, I've never been the victim of a patent troll, but it's clear that they are a serious problem with a disproportionate impact on the economy.
From "The Caging of America" by Adam Gopnik in The New Yorker:
"Brecht could hardly have imagined such a document: a capitalist enterprise that feeds on the misery of man trying as hard as it can to be sure that nothing is done to decrease that mi...
Even though the law does not specifically forbid it, local rules in effect in most (if not all) federal court districts mean that small businesses such as my own are caught between not filing legitimate claims, and not being able to afford the cost o...
The courts generally frown upon pro se representation by companies because, they argue, the quality of legal discourse would decline without professional representation. Yet individuals are allowed to represent themselves, and the courts clearly seem...
Every time I have attempted to report a serious security vulnerability, I have gotten threatened with a lawsuit or jail time.
Many government agencies have highly insecure computer systems that would benefit from expert feedback--yet most people w...
There is no standard procedure for reporting a computer security issue with a government agency. Standard procedures should be established and important fixes rewarded.
Money transmitters should pay an FDIC premium, just like a bank, so that each company doesn't have to spend millions of dollars and years of time obtaining 46 individual surety bonds. Since money transmitters have different risk profiles than banks, ...
Like many, I have stock market investments that fluctuate. Lately the market has been extremely volatile, and many suspect that some firms use their trading technology to gain an unfair advantage when placing trades.
Congress isn't necessarily well-equipped to directly investigate a complex technical issue, but there are people out there who are, and who can report back with useful insights.
I run a small business and I still have to pay my taxes because I can't afford $900-per-hour CPAs who know the entire tax code inside and out, including every loophole. Nor do I want to headquarter my company in Grand Cayman.
Many large companies use tax shelters in order to pretend as though their income came from overseas. Everyone knows about it. Yet Congress never seems to be able to fix it.
Small claims court is a real pain in the neck to deal with if you have a job or at all value your time. Nothing is on-line, everything gets rejected for the smallest technical reason, and it's a very opaque process in general.
I've read far too many articles about CEOs of companies getting paid 600 to 700 times as much as their average employees. Many of these CEOs are failed leaders whose management skills led to decreases in shareholder value or outright disasters.
Family members have taken prescription medications that did far more harm that good. These medications should not be advertised direct to consumers who are totally unqualified to evaluate them.
Right now, a basic paycheck in California has four different payroll taxes associated with it, some of which are withheld on the employer side, some of which are withheld on the employee side, some of which are federal, some of which are state, and s...
In 1999, largely for the benefit of Citigroup, the Gramm-Leach-Bliley Act repealed the Glass-Steagall Act of 1933, which for seven decades had been successful at preventing banks from gambling with customer deposits. The Glass-Steagall Act had delibe...
NIST is well-equipped to develop a simple, standard format that the federal and state governments could use to help increase transparency in government.
My brother is autistic, and our neighbors filed criminal charges against him for behavior he cannot control. Everyone wanted the behavior to stop, and yet all the charges did was make life more miserable for my brother and my family, compounding the ...
Clearly anyone who commits a murder is dangerous, but short of physical disturbance, the mentally ill should not be clogging up the court system if it can be proven that A) a given individual is incapable of learning from the court case based on past...
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Simplify HIPAA. Aaron Greenspan, October 10, 2011 at 1:47 AM EDT
The law is clearly so confusing that even highly-educated medical professionals can't interpret it properly. If the Sherman Antitrust Act could be a few clauses and still effective, why can't laws be written the same way today?
I was once waiting on crucial test results, and a nurse refused to tell them to me over the phone even though they were my results. She insisted that HIPAA prohibited her from disclosing them over the phone, and that I would have to come to the hospi...
As banks are becoming increasingly dependent on technology, and technology companies are increasingly capable of offering financial services, there is a gray area of financial regulation related to money transmission by non-banks that is becoming inc...
Right now, each state legislature determines whether or not to regulate "money transmission," which is often (but not always) defined as the act of routinely holding onto funds that belong to others with the intent of sending those funds somewhere el...
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Greenspan v. Musk et al, California Northern District Court Case No. 3:24-cv-04647-MMC
