Federal Judge Jennifer L. Rochon has dismissed a class action lawsuit against Libra organizer Kelsier Ventures and Meteora, a decentralized finance platform, and denied the plaintiffs' motion to file a second complaint.
The court dismissed all alleged charges, including fraud, violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act, violations of New York General Business Law, and unjust enrichment claims.
Court Ruling on DeFi Platform
In her opinion, Rochon ruled that plaintiffs cannot sue Meteora because they failed to prove it acted as an unincorporated association or partnership. The judge sided with the defense argument that Meteora is software and therefore cannot be sued as an entity.
RICO and Fraud Claims Dismissed
The court dismissed RICO violations allegedly committed by Kelsier Ventures, with Rochon explaining that plaintiffs failed to establish a valid pattern of racketeering activity. She highlighted that a six-month timeline was insufficient to prove the continuity required for a RICO case.
Charges against Meteora developer Benjamin Chow were also dismissed. Rochon determined that Chow's provision of technical assistance before the token's issuance and Meteora's profit from transaction fees did not prove fraudulent intent.
Impact on Investors
Estimates indicate that over 44,000 investors were affected by Libra when insiders dumped the token after early accumulation of significant volumes. The token had a stealth launch but was later promoted by Argentine President Javier Milei on social media, who framed it as a project to fund small Argentine businesses and startups.
Milei subsequently rejected liability for investor losses, comparing meme coin investments to gambling and stating that investors assumed the risks associated with their participation.
With this US decision, unless other parties come forward, the Libra matter is settled domestically. In Argentina, two deputies attempted to become plaintiffs in the case but had their request rejected by a Buenos Aires Federal Court.
