Class Action Lawsuit Filed in New York Over LIBRA Token Launch by Burwick Law

Burwick Law has initiated a class action lawsuit in New York against Kelsier Ventures, KIP Protocol, and Meteora, alleging that they conducted a deceptive launch in the LIBRA token scam.

As per the lawsuit filed on Mar. 18, the developers of the token reportedly manipulated liquidity secretly to defraud retail traders of millions of dollars, while deceiving investors with false promises.

LIBRA was promoted as an endeavor to enhance Argentina's economy, even gaining President Javier Milei's endorsement. However, the token's developers are said to have inflated prices using a one-sided liquidity pool instead of a fair launch.

"Tonight, our firm filed a class action complaint in the Supreme Court of New York on behalf of our client. We allege that Kelsier, KIP, Meteora, and related parties orchestrated an unfair token launch ($LIBRA), allegedly misleading purchasers and harming retail investors."

To maintain control over the token's value, they allegedly withheld 85% of its supply. Insiders reportedly withdrew $107 million when trading started, causing a 94% price plunge. Court documents claim this permitted insiders to "discreetly and systematically extract stable assets" from unsuspecting buyers.

In addition to seeking restitution for affected investors, Burwick Law aims to prevent future scams of this nature. In a related development, on Mar. 12, Argentine attorney Gregorio Dalbón requested an Interpol Red Notice for Hayden Davis, the CEO of Kelsier, claiming that his wealth could enable him to evade.

A Red Notice is essentially an Interpol alert asking global law enforcement to locate and provisionally arrest a person pending extradition.

The LIBRA token was launched on Solana (SOL) on Feb. 14 and rapidly reached a $4.4 billion market cap before crashing, eradicating over $280 million in value across nearly 75,000 traders. Referred to as "Cryptogate," the controversy has led to numerous allegations of insider trading and market manipulation.

According to a Mar. 14 report by Crypto.news, insiders like Kelsier Ventures were able to obtain LIBRA tokens before the public launch, making over $100 million through early trades and liquidity provision.

Beyond legal action, the Libra memecoin scandal has attracted political attention. Opposition politicians in Argentina have demanded Milei’s impeachment, citing allegations of fraud. Analysts say the crisis could harm Milei’s reputation as a leader focused on economic recovery and combating corruption as the midterm elections approach later this year.