GameStop

United

Roaring Kitty

Keith Gill, popularly known as “Roaring Kitty” on X, is facing a class-action lawsuit over his alleged involvement in a “pump-and-dump” scheme linked to his social media posts about GameStop. 
The <a href="https://storage.courtlistener.com/recap/gov.uscourts.nyed.517255/gov.uscourts.nyed.517255.1.0_1.pdf" target="_blank" rel="">lawsuit</a>, filed on June 28 in the United States Eastern District of New York, accuses Gill of using his influential social presence to manipulate GameStop’s stock price between May and June. 
The complaint accuses Gill of participating in a pump-and-dump scam by discreetly purchasing a large number of GameStop call options prior to his May 12 meme post, which marked his return after three years. 
The post was generally perceived as his rekindled interest in GameStop, enabling the stock to rise by more than 74% the next day. 
Meanwhile, Solana-based memecoins <a href="https://crypto.news/gamestop-inspired-meme-coin-surges-300-as-roaring-kitty-resurfaces-on-x/">had a 300% increase</a> shortly after Gill’s social reappearance. The most notable among them was Roaring Kitty (KITTY), <a href="https://crypto.news/kitty-token-surges-8000-amid-gamestop-investors-roaring-kitty-comeback/">which surged by over 8,000%</a> within a 24-hour period. 
On June 2, Gill returned to Reddit with a post exposing his massive stake in GameStop, which included 5 million shares and 120,000 call options with an expiry date of June 21. 
According to the complaint, the article led GameStop’s shares to soar by more than 70% in premarket trading the next day. 
The complaint additionally cited a Wall Street Journal report claiming Gill purchased a large number of GameStop options shortly before his May post, raising worries about potential stock manipulation. 
Gill revealed that he had exercised all 120,000 call options, boosting his GameStop stock holdings to over 9 million shares. However, over the next three trading sessions, GameStop’s stock price dropped by 15.18%. 
The lawsuit alleges that Gill failed to adequately disclose his intent to sell his options calls in advance, misleading his followers and other market participants and leading to losses for investors. 
Plaintiff Martin Radev, represented by the law firm Pomerantz, alleged he incurred losses from the purported “pump and dump” scheme after buying 25 shares of GameStop and three call options beginning in mid-May. 
Furthermore, the plaintiff and other class members claimed that Gill’s market manipulation via his social media influence violated federal securities laws. The complaint seeks to recover damages for losses. 
 You might also like: <a href="https://crypto.news/who-is-roaring-kitty-and-why-meme-coins-surge-after-his-return/"> Who is Roaring Kitty, and why meme coins surge after his return? </a> 
Despite the fresh charges, Eric Rosen, a former federal prosecutor and founding partner at Dynamis LLP, is skeptical of the lawsuit’s viability, <a href="https://www.dynamisllp.com/knowledge/roaring-kitty-sued-for-securities-fraud#:~:text=The%20complaint%20alleges%20he%20committed,time%20in%20years)%2C%20revealing%20a" target="_blank" rel="">predicting </a>it would fail. 
Rosen identified three shortcomings in this case, which are likely to be dismissed. 
According to him, because Gill’s options had an expiration date, it was no surprise that he would eventually sell them. 
Additionally, Gill’s tweets did not provide investment advice. According to Rosen, rational investors would not make decisions based only on his tweets. 
Moreover, Gill was not required to disclose his trading intentions, as he was not a financial advisor. 
Rosen noted that only financial advisors or fiduciaries are generally required to disclose their positions or intentions, adding that “Roaring Kitty is neither.” 
He further explained that this “will be a hurdle that the plaintiffs will have to get over, and it will be difficult for them to do so.” 
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper"> 
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 so a dude named Martin Radev is suing Roaring Kitty for securities fraud due to his promotion of gamestop <a href="https://twitter.com/search?q=%24gme&amp;src=ctag&amp;ref_src=twsrc%5Etfw" target="_blank" rel="">$gme</a> in a class action lawsuit the dude has 35 shares and a couple of options 💀💀💀 i dont think the case has the best chance in court and won’t really affect Keith Gill,… <a href="https://t.co/WIuUSpds6n" target="_blank" rel="">pic.twitter.com/WIuUSpds6n</a>— amit (@amitisinvesting) <a href="https://twitter.com/amitisinvesting/status/1807587523050328075?ref_src=twsrc%5Etfw" target="_blank" rel="">July 1, 2024</a>
 </blockquote>
 <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
 </div>
</figure> 
 Read more: <a href="https://crypto.news/meme-coins-drop-over-10-following-gamestop-stock-crash/"> Meme coins drop over 10% following GameStop’s stock crash </a>

‘Roaring Kitty’ faces class-action lawsuit over alleged GameStop stock manipulation

crypto.news

Other articles published on Jul 1, 2024

Coinbase Expands Futures Trading with CFTC-Regulated Altcoins Including LINK, DOT, and SHIB

German government moves additional $94 million worth of bitcoin to exchanges

Altcoin News: Institutions Are Buying Solana, XRP, & 2 Other Altcoins

OKX Rewards Compound Users with 100,000 ARB Bonus Campaign

Tether and Uquid Partner to Enable USDT Payments for Social Security Contributions in the Philipp...

Bitcoin and RNDR Show Significant Price Increases

Join our free newsletter for daily crypto updates!