A US judge has dismissed a proposed class action lawsuit concerning the LIBRA and M3M3 memecoins, closing investors' district-court path to recovery. LIBRA gained attention after being promoted by Argentine President Javier Milei before he withdrew his support on the day of its launch.
In a Sept. 29 opinion, Judge Jennifer L. Rochon dismissed the amended complaint with prejudice, denied permission for further amendments, and ordered the Southern District of New York case closed. The ruling also blocked plaintiffs from expanding the lawsuit to include three other tokens: MELANIA, ENRON, and TRUST.
Plaintiffs in the case alleged that insiders controlled token launches and extracted funds from liquidity pools at the expense of outside investors. However, the central federal claim—relying on the Racketeer Influenced and Corrupt Organizations Act, or RICO—failed because investors did not adequately plead RICO continuity.
The court found that the alleged conduct, spanning from October 2024 through the March 2025 complaint, constituted a short duration that failed to meet Second Circuit precedent for closed-ended continuity. Additionally, the court ruled that broad assertions regarding a repeatable token-launch business failed to establish a continuing threat of criminal activity.
Following the dismissal of the federal RICO claims, the court dismissed remaining state-law claims against the Kelsier defendants due to a lack of personal jurisdiction, noting that nationwide social media and crypto infrastructure did not establish sufficient New York connections. Claims against Benjamin Chow were dismissed for pleading defects, including insufficient allegations of fraudulent intent, while claims against Meteora failed because investors did not adequately plead it as a legal association or partnership capable of being sued.
The court's dismissal with prejudice concludes the district-court action without determining whether the underlying conduct was lawful or addressing other potential recovery routes.
