TL;DR:
- Judge Jennifer L. Rochon of the Southern District of New York dismissed the class action lawsuit over the $LIBRA, $M3M3Â tokens with prejudice on September 29, 2026.
- The complaint accused the defendants of operating an unlawful enterprise that allegedly siphoned 44.6 million USDC and 249,665 SOL from liquidity pools.
- The court determined that the alleged activity spanned only six months, an insufficient timeframe to establish a pattern of continuity under the federal RICO Act.
A U.S. federal judge has dismissed a class action lawsuit tied to the token launches of memecoins $LIBRA, $M3M3, ending the ongoing litigation brought against Hayden Davis, Kelsier Ventures, former Meteora CEO Benjamin Chow, and Meteora itself.
The 81-page ruling, issued on Tuesday, September 29 in the Southern District of New York, concluded that the plaintiffs failed to satisfy the legal standards required to support racketeering and fraud allegations. Judge Jennifer L. Rochon granted the dismissal with prejudice and formally denied leave to file a second amended complaint.
Plaintiffs Omar Hurlock and Anuj Mehta alleged that the defendants leveraged corporate entities, digital wallets, and liquidity pools to improperly profit from token launches. The legal action invoked the federal Racketeer Influenced and Corrupt Organizations Act (RICO), New York state business statutes, and unjust enrichment claims.
According to the court order cited in market reports, the primary hurdle for the plaintiffs was the lack of continuity required under RICO. The alleged unlawful enterprise purportedly operated from October 2024 until the lawsuit was officially filed on March 17, 2025.
Judge Rochon ruled that an operational duration of roughly six months does not represent a sufficiently substantial time period to establish closed-ended continuity for an organized conspiracy claim.
Furthermore, the court noted that the complaint outlined a single scheme, five defendants, a single discrete goal, and wire fraud as the sole underlying predicate offense. Under the ruling, this structure fails to establish the requisite pattern of continuous racketeering activity demanded by federal law.
Court Findings on Meteora’s Structure and the Defendants
Claims directed against the Meteora protocol also failed to withstand judicial scrutiny. The lawsuit characterized Meteora as an unincorporated association, a designation the judge rejected due to insufficient evidence.
To support that assertion, the plaintiffs pointed to a 4-of-7 multi-signature wallet used to authorize software updates. The court clarified that holding administrative keys to push code updates is not legally equivalent to a seven-member board executing joint commercial decisions.
Similarly, no actionable basis was found against former company executive Benjamin Chow. The plaintiffs based their claims on comments made in group calls and informal remarks; however, the ruling determined that no concrete facts evidenced a deliberate fraudulent intent.
In their initial complaint, the plaintiffs alleged that wallets associated with Kelsier bought $M3M3 while the liquidity pool was frozen in order to dump into subsequent market demand. In the case of $LIBRA, the filing alleged the extraction of 44.6 million USDC and 249,665 SOL from liquidity reserves.
Judge Rochon emphasized that these metrics represented unverified assertions by the litigants rather than established judicial facts, noting that proceedings concluded prior to reaching the evidentiary discovery phase.
The plaintiffs also attempted to add other tokens—such as $MELANIA, ENRON, and TRUST—to the litigation, a request the court denied as it failed to cure the complaint’s underlying structural defects. With the federal claims dismissed, the court also found a lack of personal jurisdiction to keep Davis and Kelsier subject to New York courts.
The dismissal with prejudice brings the proceedings in the Southern District of New York to a close, while separate ancillary matters and administrative inquiries surrounding $LIBRA remain ongoing across other regulatory venues.
