Key Highlights
- Judge dismisses $LIBRA and $M3M3 lawsuit, closing the case against Hayden Davis, Kelsier Ventures, Benjamin Chow and Meteora.
- The judge found the alleged activity lasted about six months, which was not enough to show a continuing pattern of illegal activity.
- The case ended before discovery, so the court did not determine whether the alleged insider activity happened or how much defendants may have made.
A federal judge has dismissed a class-action lawsuit over the $LIBRA and $M3M3 memecoin launches, ending the case against Hayden Davis, Kelsier Ventures, former Meteora CEO Benjamin Chow and Meteora.
According to the court filing, Judge Jennifer L. Rochon issued the ruling in the Southern District of New York on September 29, finding that the plaintiffs had not shown enough to support their claims. The 81-page ruling dismissed the amended complaint with prejudice, meaning the plaintiffs cannot bring the same claims back through another amended complaint. Rochon also denied their request to file a second amended complaint.
However, the judge did not decide whether the alleged insider trading or extraction around the tokens actually happened. The case ended before discovery, and the ruling focused on whether the plaintiffs had adequately pleaded legally viable claims.
What the plaintiffs claimed
The lawsuit was brought by Omar Hurlock and Anuj Mehta, who accused the defendants of using a network of companies, wallets, and liquidity pools to profit from memecoin launches.
Their complaint included claims of fraud, conspiracy, violations of the federal RICO law, New York business law violations, and unjust enrichment.
Why the RICO claims failed
One of the biggest issues was the RICO claims. The plaintiffs argued that the defendants operated together as an enterprise involved in repeated illegal activity.
But Rochon found that the plaintiffs had not established the continuity required to show a RICO pattern. The alleged enterprise operated from at least October 2024 through the filing of the complaint on March 17, 2025, a period of about six months. The judge found that this was not a sufficiently substantial period for closed-ended continuity under RICO.
The court also looked at the number of people involved and the nature of the alleged activity. Rochon found that the complaint described one enterprise, five defendants, one main goal, and wire fraud as the only underlying crime. The court concluded that these allegations did not establish the continuing pattern required under RICO.
Meteora faces a legal issue
The claims involving Meteora also faced a separate legal issue. The plaintiffs described Meteora as an unincorporated association, but the judge said they did not properly show that the group legally operated that way.
They pointed to a 4-of-7 multisig wallet that could approve changes to Meteora’s programs. Rochon said that the ability of wallet holders to modify software was not analogous to a seven-member board making joint business decisions. References to a “Meteora team” also did not establish that its members had formed a legally recognized association.
The court therefore dismissed all claims against Meteora without reaching Dynamic Labs’ remaining arguments.
Chow also wins dismissal
Chow also won dismissal of all claims against him. The plaintiffs pointed to his comments during an $M3M3 planning call, a calculation template, and his later statement that he had “fucked up because [he] enabled” Davis. But the judge found that the complaint did not provide enough facts to show that Chow intended to commit fraud. Rochon said a profit motive by itself was not enough.
The lawsuit had made serious allegations about both token launches. For $M3M3, the plaintiffs claimed wallets connected to Kelsier bought tokens while the launch pool was frozen before selling into demand. For $LIBRA, they alleged that intermediary wallets later removed about 44.6 million USDC and 249,665 SOL from liquidity pools.
Those allegations were part of the plaintiffs’ complaint and were not established as facts by the court. The court’s ruling addressed whether the claims were adequately pleaded, rather than determining whether the alleged token extraction occurred.
The allegations remain unresolved
The plaintiffs later tried to add $MELANIA, $ENRON and $TRUST to the case, but the judge rejected the proposed changes because they would not fix the problems already identified. With the federal claims gone, the court also found that there was no remaining basis to bring the Kelsier and Davis defendants under New York jurisdiction.
The case is now closed. The ruling only decided whether the plaintiffs had properly presented their legal claims. It did not establish whether the alleged token extraction took place or how much money any defendant may have made. Separate proceedings connected to $LIBRA remain outside this case.
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