Investors Sue Kelsier Labs and Partners for Fraudulent Memecoin Launches
On Wednesday, July 30, 2025, Omar Hurlock and Anuj Mehta filed an amended class action lawsuit in the US District Court for the Southern District of New York against Kelsier Labs LLC, operating as Kelsier Ventures, Hayden Davis, Gideon Davis, Charles Thomas Davis, Benjamin Chow, and Meteora, alleging fraudulent practices in decentralized finance (DeFi) markets on the Solana blockchain. The lawsuit claims the defendants orchestrated a scheme to manipulate memecoin launches, specifically $M3M3 and $LIBRA, to extract profits from retail investors.
The plaintiffs assert that the defendants, referred to as the “Meteora Defendants” (Chow and Meteora) and the “Kelsier Defendants” (Kelsier Labs, Hayden Davis, Gideon Davis, and Charles Thomas Davis), collaborated to create a deceptive appearance of trustworthiness in memecoin launches on Meteora’s protocols. The complaint alleges that the defendants controlled smart contracts to manipulate token prices, liquidity, and trading advantages, misleading investors about the fairness of the launches.
The $M3M3 token, launched on December 4, 2024, was promoted as the debut asset of Meteora’s “stake-to-earn” platform, promising investors passive income through transaction fees. The lawsuit claims that the defendants secretly froze trading at launch, allowing insider wallets, funded by Kelsier, to acquire 95% of the token supply at low prices. After unfreezing trading, they allegedly inflated the price through artificial volume and sold their holdings, causing a price collapse that resulted in significant losses for retail investors, including plaintiff Anuj Mehta, who reportedly lost $19,164.
Similarly, the $LIBRA token, launched on February 14, 2025, was marketed as an “Argentina coin” with alleged endorsement from Argentine President Javier Milei. The plaintiffs allege that the defendants used Meteora’s Dynamic Liquidity Market Maker to create single-sided liquidity pools, enabling price manipulation that extracted tens of millions in USDC and SOL from investors in minutes. Plaintiff Omar Hurlock reportedly lost approximately 0.302 wSOL in $LIBRA transactions on the launch day.
The lawsuit accuses the defendants of violating federal Racketeer Influenced and Corrupt Organizations Act (RICO) laws through a pattern of racketeering activity, including wire fraud, and the New York General Business Law for deceptive acts and false advertising. It further alleges unjust enrichment and seeks to recover damages for affected investors.
The complaint details the defendants’ use of 150 insider wallets to control token supply, coordinated promotional campaigns, and undisclosed partnerships. It claims that Benjamin Chow, former CEO of Meteora, and Hayden Davis, CEO of Kelsier Ventures, led the schemes, leveraging their reputations in the Solana community. The lawsuit also references communications in a private Telegram group and planning documents, including a Google spreadsheet created by Chow to model $M3M3’s economic mechanics.
The plaintiffs demand a jury trial and seek to enjoin the defendants’ alleged predatory practices.
Please contact BlockTribune for access to a copy of this filing.
