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In a newly filed class-action lawsuit, two investors, Naeem Azad from the UK and Mihai Caluseru from Romania, have taken legal action against Caitlyn Jenner. They accused the celebrity of promoting an unregistered cryptocurrency, JENNER, which ultimately led to significant financial losses for buyers.
Lack of Transparency
Filed in a California federal court on November 13, the suit alleges that Jenner and her manager, Sophia Hutchins, marketed the token with misleading information, convincing financially inexperienced investors to buy in. According to the plaintiffs, the lack of transparency about the token’s risks prevented investors from making informed decisions, resulting in collective losses exceeding $56,000.
The complaint highlights that Jenner launched the token on the Solana blockchain in May through Pump.fun, a memecoin creation platform. Shortly after, controversies arose, with allegations that one of her collaborators, Sahil Arora, had “scammed” her and other figures involved. Jenner then relaunched the token on Ethereum, but the token’s value has since plummeted, hitting an all-time low on Nov. 13.
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Market Manipulation Allegations
The complaint accuses Jenner of manipulating investor expectations by setting target prices and predicting substantial growth for the token, while failing to provide essential disclosures to potential buyers.
Shortly after the token’s launch, Arora allegedly offloaded a large portion of his holdings, causing a significant drop in the token’s value. The suit contends that this risk of a “pump-and-dump” scenario, a common form of market manipulation, was one Jenner was obligated to disclose to potential investors — an obligation she “willfully neglected,” according to the complaint.
In the aftermath, the plaintiffs claim that Jenner shifted the project to Ethereum, implementing a 3% transaction tax on each trade of JENNER. This tax, which was reportedly never disclosed transparently, allegedly allowed Jenner to continue profiting while the token’s price spiraled downward.
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SEC Violations and Alleged Misrepresentation of Token
The lawsuit further accuses Jenner of breaking securities laws, citing her lack of registration for the token with the Securities and Exchange Commission (SEC) and her alleged failure to reveal her personal holdings. The plaintiffs allege that the celebrity misrepresented both the value and future prospects of the token, while profiting from pre-access tokens she acquired at significantly lower prices than those available to the public.
Azad and Caluseru’s suit claims fraud, securities violations, and aiding and abetting against Jenner and Hutchins, arguing that the value of the token has diminished beyond recovery. They seek damages not only for their own losses but on behalf of all investors who believed in the token’s potential based on Jenner’s endorsements and the expectations she allegedly set.
