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November 14, 2024Caitlyn Jenner Faces Class-Action Lawsuit Over Memecoin “JENNER” Token
A group of memecoin buyers has filed a proposed class-action lawsuit against former Olympic gold medalist Caitlyn Jenner, accusing her of selling the JENNER token as an unregistered security. The lawsuit, filed on November 13 in a California federal court, also names Jenner’s manager, Sophia Hutchins, as a defendant for allegedly aiding in the fraudulent solicitation of investors.
The plaintiffs, Naeem Azad and Mihai Caluseru, who are residents of the United Kingdom and Romania, claim they lost over $56,000 purchasing the JENNER token on the Ethereum and Solana blockchains. They argue that they would not have made the investments had it not been for Jenner’s false and misleading statements about the token.
Allegations of Fraudulent Solicitation and Unregistered Securities
The lawsuit alleges that Jenner and Hutchins fraudulently solicited investors by promoting JENNER as an investment without registering the token with the U.S. Securities and Exchange Commission (SEC). The plaintiffs argue that had the token been properly registered, they would have been given necessary information to assess the risks associated with the investment.
According to the complaint, Jenner “willfully failed” to disclose important details about the token, such as the risks involved, its financial backing, and the structure of the token’s offerings, which led to significant damages for investors. The plaintiffs claim that Jenner’s actions resulted in them being unable to properly evaluate the investment’s viability before purchasing.
Launched in May 2023, the JENNER token was initially introduced on the Solana blockchain by the memecoin creator Pump.fun. However, the token quickly became embroiled in controversy when Jenner and other high-profile figures accused collaborator Sahil Arora of scamming them. Shortly after, Jenner relaunched the token on Ethereum in an attempt to salvage the project.
The Ethereum version of the token, however, saw its price crash dramatically, falling to an all-time low of just $170,000 in total market value as of November 13, down from a peak of nearly $7.5 million. Trading volume on the token also plummeted, with just $1.80 in trading volume over the past 24 hours, according to CoinGecko.
Allegations of Misleading Claims and Hidden Profits
The lawsuit claims that Jenner actively promoted the token by setting price and market capitalization targets soon after the Solana launch. However, the price of the token crashed after Arora allegedly sold a large portion of his own holdings. The plaintiffs contend that this was a risk that Jenner had a duty to warn investors about but willfully failed to disclose.
Jenner’s involvement in the project continued after the Solana token crash when she launched the Ethereum version, which Azad and Caluseru argue tanked the value of the original Solana token. Additionally, they claim that Jenner instituted a 3% “tax” on every transaction, a fee that she never properly disclosed, and which allegedly enriched Jenner personally.
The complaint further alleges that Jenner used profits from the JENNER token to pay for exchange listings and promised token buybacks—both of which allegedly never materialized, leading to further investor losses. The plaintiffs argue that these actions violated securities laws and contributed to the token’s failure.
Additionally, the lawsuit claims that Jenner omitted critical information from investors, including the amount and cost of her own JENNER holdings—which she allegedly obtained earlier and at a cheaper price than the general public. The plaintiffs also assert that Jenner failed to properly disclose her dealings with Arora.
Legal Claims Against Jenner and Hutchins
Azad and Caluseru’s lawsuit brings multiple legal claims against Caitlyn Jenner, including securities fraud, common law fraud, and violations of securities laws. It also includes claims of aiding and abetting fraud against Sophia Hutchins, who is accused of assisting Jenner in the alleged fraudulent scheme.
The plaintiffs are seeking damages for their financial losses and are pushing for the case to proceed as a class action, potentially representing a broader group of investors who were similarly affected by the alleged fraud.
As of now, no information on Jenner’s legal representation is available, and she has not responded to the lawsuit or made any public statements about the allegations. A request for comment sent to Jenner’s official website did not receive an immediate reply. Sophia Hutchins could also not be reached for comment.
The legal action against Caitlyn Jenner and her manager Sophia Hutchins adds to the growing scrutiny of celebrity involvement in the cryptocurrency space. As more high-profile figures enter the crypto market, this case could set important legal precedents regarding the responsibilities of celebrities in promoting digital assets. For now, investors affected by the JENNER token’s crash may be hoping that this lawsuit will provide a path to recover their losses and bring accountability to the rapidly expanding world of memecoins and celebrity-backed crypto projects.
