As a seasoned crypto investor with over a decade of experience under my belt, I can’t help but feel a mix of amusement and concern when I hear about lawsuits like this one involving Caitlyn Jenner and her memecoin, JENNER. While I don’t know the specifics of this case, it seems to me that celebrities jumping into the crypto space can be both exciting and risky.
A band of meme coin purchasers have initiated a potential collective legal action, charging the former Olympic athlete Caitlyn Jenner with illegally selling a celebrity-linked token without proper registration, claiming it functioned as an unlicensed security.
Naeem Azad, a UK citizen, and Mihai Caluseru, a Romanian national, submitted a complaint to a federal court in California on November 13. The complaint alleges that Caitlyn Jenner and her manager Sophia Hutchins deceptively encouraged financially uneducated investors from across the U.S. and abroad to buy unregistered securities, which is considered fraudulent.
They assert that they incurred a loss exceeding $56,000 when purchasing JENNER tokens on both Ethereum and Solana platforms. Moreover, they attribute this financial setback to the allegedly deceptive and misleading statements and omissions made by Jenner.
The suit claimed Jenner “willfully failed” to register the token with the Securities and Exchange Commission, and buyers “suffered significant damages” as they didn’t have information to evaluate the risk of investing, which they said would have been shared if JENNER was registered.
Initially, JENNER was introduced on Solana through the platform Pump.fun, a memecoin creator, back in May. However, it quickly found itself in controversy when JENNER and other notable figures accused collaborator Sahil Arora of fraudulent activities. In response to this, JENNER re-introduced the token on Ethereum network.
Since its launch, the Ethereum token has essentially become worthless, reaching an all-time low price on November 13 at around $170,000 – a significant drop from its peak value of approximately $7.5 million. Trading volume over the past day was minimal, with only $1.80 being exchanged, as reported by CoinGecko.
The complaint suggests that Jenner seems to have barely touched the project anymore, no longer publicly supports the memecoin, and this has left its investors bearing substantial financial losses. The complaint goes on to say that it’s improbable these losses can ever be regained.
The lawsuit claimed that soon after the Solana token was launched, Jenner began “touting price and market capitalization targets” for it.
Following Arora’s sale of a substantial amount of the tokens he held, the token subsequently plummeted. The lawsuit alleged that this was the very risk Jenner should have warned investors about when encouraging their investments, a duty she deliberately neglected to fulfill, acting primarily in her own financial interest.
Initially, Jenner reintroduced the token on the Ethereum platform. This move, as asserted by Azad and Caluseru, led to a significant drop in the worth of the initial Solana token. However, they alleged that she implemented a 3% fee on every transaction, a detail they suggested she failed to fully disclose initially. They further argued that this move has allegedly brought Jenner substantial wealth.
It’s been asserted that they believe the actions taken by Jenner violated securities regulations. The allegation is that profits from the token were utilized to facilitate its listing on various exchanges, and promises were made about future token repurchases. However, according to the lawsuit, these alleged activities never took place, and their absence reportedly led to additional financial losses.
The suit further claimed that Jenner intentionally failed to disclose information, specifically the value and expense of her own and other insiders’ JENNER shares, which she allegedly acquired earlier and less expensively than the general public, as well as providing specifics about her transactions with Arora.
In addition to their lawsuit, Azad and Caluseru are alleging charges of securities and common law fraud against Jenner, while leveling securities law violations and accusations of aiding and abetting fraud against Hutchins.
Details concerning Jenner’s legal representatives were not readily accessible at the time. Jenner did not promptly reply to a request for a statement sent through her website. Efforts to contact Hutchins for comment were unsuccessful.
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2024-11-14 09:05