Greenspan v. Qazi

Background

Aaron Jacob Greenspan, proceeding without a lawyer, filed a fourth amended complaint after the court dismissed his third amended complaint. The earlier order identified problems with proposed federal securities and copyright claims against Elon Musk and Tesla, and against Omar Qazi and Smick Enterprises, Inc. The court had permitted another amendment and limited the new complaint to 75 pages. The defendants sought dismissal of the fourth amended complaint. The motions addressed only the federal securities and copyright claims because those claims supplied the court’s subject-matter jurisdiction.

Securities claims

The court found that the fourth amended complaint did not add facts making the securities claims plausible. Greenspan largely repeated allegations from the third amended complaint, including allegations about Tesla’s disclosures concerning cash and cash equivalents. The complaint still did not identify actionable false or misleading statements with the required specificity or adequately allege an intent to deceive. The court also found that the allegations did not support claims based on Section 10(b) or Rule 10b-5, market manipulation, or control-person liability under Section 20(a).

The court separately found that the securities allegations against Qazi remained implausible. The complaint did not plausibly allege an agency relationship between Musk and Qazi or a material misrepresentation by either person. The court characterized Qazi’s statement calling Tesla’s autopilot functionality the “eight [sic] wonder of the world” as an opinion rather than a material misrepresentation. The court also stated that certain forward-looking comments attributed to Musk fell within the federal securities-law safe harbor for such statements.

Copyright claims

The court found no new facts making the copyright claims against Qazi and Smick plausible. It adhered to its earlier conclusion that the challenged conduct was protected by fair use as commentary and criticism. The fourth amended complaint did not provide a reason to change the court’s conclusions concerning the nature of the work, the amount and importance of the material used, or the effect of the use on the market. The court also found no basis to change its prior conclusions concerning a photograph allegedly used without copyright-management information and alleged misrepresentations in Digital Millennium Copyright Act notices and counternotices.

Ruling

The court dismissed the federal securities and copyright claims with prejudice because Greenspan had already been given substantial opportunities to amend and had not plausibly alleged those claims. It dismissed the state-law claims without prejudice after declining to exercise supplemental jurisdiction. The court denied the requests for judicial notice, did not rely on disputed facts in the submitted materials, and closed the case. The order was signed by Judge James Donato.