A US federal judge has dismissed a proposed class-action lawsuit brought by investors in LIBRA and M3M3, ending the case in New York unless a separate recovery route is pursued.
In an opinion issued on Sept. 29, Judge Jennifer L. Rochon dismissed the amended complaint with prejudice, refused to allow the plaintiffs to amend it again and ordered the case closed in the Southern District of New York. The ruling also prevented the investors from expanding the action to include three additional tokens: MELANIA, ENRON and TRUST.
According to CryptoSlate, the investors claimed that insiders controlled the launches of the tokens and removed funds from liquidity pools at the expense of outside buyers. The case focused on whether those allegations were legally sufficient and whether the court had authority to hear the claims. The ruling did not determine that every alleged act was lawful, nor did it address every possible avenue for investors seeking recovery.
Why the RICO claims failed
The lawsuit’s main federal claim was based on the Racketeer Influenced and Corrupt Organizations Act, commonly known as RICO. Among other requirements, a civil RICO case must allege a pattern of related racketeering activity that either lasted for a substantial period or posed a threat of continuing criminal conduct.
Judge Rochon found that the plaintiffs had not adequately pleaded either form of continuity against the defendants associated with Kelsier, including Kelsier Ventures and Hayden Davis, or against Benjamin Chow, Meteora’s co-founder and former chief executive.
The complaint described alleged conduct beginning in October 2024 and continuing through the filing of the case in March 2025. The court treated that as a period of about six months. It concluded that the number of alleged schemes and the potentially large number of affected investors did not make up for the limited duration. The opinion relied on Second Circuit precedent generally requiring a longer period for this type of RICO continuity, while noting that two years is not an automatic legal threshold.
The alternative theory required the investors to show facts indicating a continuing threat of racketeering. The court said broad claims about a repeatable token-launch operation and references to other projects did not establish, for each defendant, that alleged wire fraud was part of a regular business practice. The related RICO conspiracy allegations therefore failed as well.
Other claims and proposed additions also rejected
The plaintiffs sought to revise the case again by adding MELANIA, ENRON and TRUST, along with another plaintiff and additional defendants. The judge found that the proposed changes would extend the alleged racketeering period to only seven months and did not correct the shortcomings concerning an ongoing threat. The request for another amendment was denied.
Once the RICO allegations failed, the court dismissed the remaining state-law claims against the Kelsier defendants because the plaintiffs had not established personal jurisdiction in New York. The investors pointed to nationwide social-media activity and cryptocurrency infrastructure, but the court found those allegations insufficient to show the required connections to the state. It did not rule on the underlying merits of those state-law claims.
The claims against Chow were dismissed for pleading defects that included inadequate allegations of fraudulent intent. The court also dismissed the claims against Meteora because the investors had not sufficiently pleaded that it was a legal association or partnership that could be sued.
The ruling follows an earlier dispute in June 2025, when Davis denied wrongdoing and challenged the court’s jurisdiction. With the amended complaint dismissed with prejudice, the investors no longer have a route forward through this particular proposed class action in the New York district court.
LIBRA background and current market picture
The complaint, as summarized by the court, alleged that LIBRA launched on Feb. 14, 2025, and that Argentine President Javier Milei promoted the token before withdrawing his support later that day. The lawsuit centered on the investors’ allegations about the launch, token control and liquidity pools; the dismissal addressed the legal sufficiency and jurisdictional problems presented in the case.
The broader crypto market data supplied by Moneyiar shows a mixed picture at the stated times on Oct. 3, 2026:
- Sui (SUI) was trading at $1.170261429, down 0.95% over 24 hours and up 1.05% over seven days, as of 09:33 +03:30.
- RedStone (RED) was at $0.1687869321, down 2.61% in 24 hours and 0.40% over seven days, as of 09:34 +03:30.
- Ontology (ONT) stood at $0.0606464648, up 1.02% over 24 hours and 1.35% over seven days, as of 09:33 +03:30.
- Memecoin (MEME) was priced at $0.0005793111, down 4.04% over 24 hours and 9.97% over seven days, as of 09:33 +03:30.
These figures are Moneyiar market data at the times shown and do not indicate the value or performance of LIBRA, M3M3 or any other token involved in the lawsuit.
