Kelsier Ventures Co-Founder Seeks Dismissal of $100 Million LIBRA Lawsuit

Hayden Davis, co-founder of Kelsier Ventures, has filed a motion to dismiss a class-action lawsuit against him in a New York federal court. The lawsuit, brought by a group of LIBRA token buyers led by Omar Hurlock, alleges that Davis and his co-founders misled investors about the token's purpose and siphoned over $100 million from liquidity pools. Davis argues that the court lacks jurisdiction over the case because the LIBRA token was offered globally and not specifically targeted at New York residents.

Davis's motion to dismiss the lawsuit claims that the court allowing the complaint to continue would violate constitutional due process, as he does not reside in New York, does not transact business there, and was not physically present in the state when the allegedly tortious conduct occurred. He also argues that the promotion for the LIBRA token was not targeted at New York residents and that the project was conceived of in Argentina.

The LIBRA token attracted significant controversy in February after its value plummeted by 94% from a $4.6 billion market cap. The token's meteoric rise was partly due to an X post from Argentine President Javier Milei praising the token. The lawsuit also names blockchain infrastructure companies KIP Protocol and its CEO, Julian Peh, along with crypto platform Meteora and its co-founder, Benjamin Chow, as defendants.

In May, the class group won a temporary order directing stablecoin issuer Circle to freeze around $57.65 million worth of USDC allegedly tied to the LIBRA project. The LIBRA token's rise and fall caused a political scandal for Milei, with members of Argentina’s opposition party calling for his impeachment. However, no action was taken against Milei or any official allegedly tied to promoting LIBRA, and the country’s corruption watchdog cleared Milei over the saga.

The class group will now have to prove its allegations against Davis are tied to New York, while Davis has called for the suit to be dismissed without prejudice, meaning the claims could be re-filed in another court. The outcome of this legal battle will be closely watched by the cryptocurrency community, as it could set a precedent for future cases involving global token offerings and jurisdiction.