Prominent crypto law firm Burwick Law has filed a lawsuit against the entities tied to LIBRA token, seeking disgorgement of profits and compensation for losses.
The LIBRA token saga has taken another legal twist amid heightening tension between its creators and Argentine prosecutors. This time, investors in the United States have unanimously filed a lawsuit against the firms affiliated with the controversial meme coin.
On Monday, Burwick Law announced a lawsuit against Kelsier Ventures and two crypto platforms, Meteora and KIP Protocol. The legal firm sued the involved parties on behalf of its aggrieved clients at the Supreme Court of New York.
Affected Investors Seek Recompense
Notably, the lawsuit accused Kelsier, KIP, and Meteora of misleading retail investors into acquiring the “scam” token, leading to massive losses. Notably, The Crypto Basic earlier reported that 86% of wallets that bought the LIBRA token lost a combined $251 million.
The lawsuit branded the token’s launch “deceptive, manipulative, and fundamentally unfair,” citing several instances of insider foul play. Burwick highlighted cases such as the one-sided liquidity addition by the token’s developers on DEX Meteora, where they replaced Solana and USDC on the liquidity pool with LIBRA.
Additionally, it mentioned the “predatory” move to centralize LIBRA’s token distribution without due disclosure. Per reports, over 83% of the token’s supply was held in one cluster, making it easy for the project’s insiders to dump on well-meaning retail investors.
The lawsuit seeks to disgorge profits that the token creators unfairly realized. Notably, the team, led by Hayden Davis, made off with over $100 million, leaving over 13,000 LIBRA wallet holders with a minimum loss of $1,000.
Furthermore, Burwick pleads for the recompense of affected investors and payment for damages. The lawsuit also seeks injunctive relief mandating the team to never create “fraudulent tokens” in the future.
The Saga Drags On
The LIBRA token controversy emanated from a Feb. 14 tweet from Argentina’s President Javier Milei promoting a meme coin, which he said was in an attempt to inspire small business funding in Argentina. However, the effort went south as the bad actors behind the token leveraged his influence to allegedly defraud investors.
The token capsized over 95% after the president deleted the tweet, with the fallout catalyzing impeachment threats from the opposition party. However, Milei has insisted on no wrongdoing and called the ploy a politicization of his gesture to promote innovation in Argentina.
Moreover, the Argentine prosecutors have made efforts to freeze the $100 million gains generated from the LIBRA token scam while officially seeking the Interpol Red Notice on creator Davis.
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