Wallstreetbets founder Jaime Rogozinski sues Reddit: Mud fight for the number one gambler forum

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Compensation, please:

is suing the online debate club Reddit.com

Photo: Jordan Vonderhaar / Bloomberg

The electronics retail chain Gamestop, the cinema operator AMC, the furnishing retailer Bed, Bath & Beyond, the headphone manufacturer Koss Corp – of all these US companies, hardly anyone in Germany would have taken notice in recent years if it weren’t for the Wallstreetbets (WSB) forum. on the discussion platform Reddit on the Internet.

On wall street bets, private investors exchange wild investment tips, team up for concerted actions on the stock market and thus sometimes drive up the share prices of companies whose business hardly justifies such a price development.

The most prominent example was Gamestop stock, whose price was at times driven to such exorbitant heights by the WSB community in 2021 that even some hedge fund professionals on Wall Street who had bet on the paper falling in price got into trouble.

In the meantime, it has actually become quieter about wall street bets.

In particular, the weak development of the stock markets in 2022, when interest rate hikes by many central banks in the fight against inflation caused price losses, apparently spoiled the fun for many gamblers.

But now the story is coming back to life:

, the man who started WSB a good ten years ago, is suing Reddit.

Rogozinski accuses the platform, among other things, of violating a contract when it stripped him of the role of Wallstreetbets moderator in 2020, reports the Wall Street Journal.

In addition, Reddit wrongly prevented Rogozinski from securing the trademark rights to "Wallstreetbets".

According to the lawsuit, which is also quoted by the Reuters news agency, Rogozinski further claims that Reddit's reasoning that he violated the platform's rules was only superficial.

In fact, the company feared Rogozinski could take control of "a well-known brand that has helped Reddit boost its valuation to as high as $10 billion."

Reddit calls allegations "ridiculous and unrelated to reality"

Unsurprisingly, the other side sees it differently.

Jaime has been replaced as moderator and banned from the group for attempting to enrich himself, a Reddit spokeswoman told The Wall Street Journal.

The current lawsuit is also an obvious attempt at enrichment.

According to the spokeswoman, Rogozinski's allegations are completely ridiculous and have no connection to reality.

Background: Rogozinski founded WSB in early 2012. At the time he was single and an IT consultant at the Development Bank in Washington.

A few years ago, Rogozinski said he was looking for something different from the boring online forums (like the Reddit forum Investing, which the community hates) that conservatively praised long-term wealth accumulation.

He wanted to find trading ideas to gamble in the short term.

"With bigger levers and with more action in less time."

He succeeded: When cheap brokers like Charles Schwab or TD Ameritrade led more and more private investors to the stock market in the USA from 2019, WSB suddenly became enormously popular on Reddit.

In the meantime, 13.6 million users have joined the forum, or as the WSB fans call themselves: degenerates.

Rogozinski wrote a book about the new role of millennials in the stock market around the same time, peppered with anecdotes from wall street bets, and he posted a link to the Amazon order page for the book on the forum.

He also announced a trading competition which he also promoted on the WSB forum.

Rogozinski: "I felt cheated"

The founder of the forum did not make many friends on Wall Street bets, according to the "Wall Street Journal".

Reddit also became aware of the matter.

The company came to the conclusion that Rogozinski's actions violated the rules that say no one can use the Reddit forums to get rich.

A back and forth followed, at the end of which Rogozinski not only lost his role as WSB moderator.

Rather, he was completely excluded from the group, which at the time only had around one million users.

And in a dispute over the "Wallstreetbets" brand, he also lost to Reddit.

Rogozinski, who now lives in Mexico City and has taken on both US and Mexican citizenship, has apparently not gotten over the pain of these defeats to this day.

"It felt personal," he told the Wall Street Journal.

"And I felt betrayed."

Now he's hoping for at least $1 million in damages.

Until the lawsuit is decided, Rogozinski should at least avoid visiting "his" Wallstreetbets forum on Reddit.

Unsurprisingly, his lawsuit is already one of the top topics that users are discussing.

However, what Rogozinski would have to read about himself is not very flattering.

"Where were you when Jartek (

) was thrown out?" asks the user "Gingalain".

"I was in the bathroom doing **** (

)", replies "MetamorphicHard".

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