Hayden Davis asks New York court to dismiss LIBRA scam class action lawsuit

Hayden Davis, co-founder of Kelsier Ventures behind the LIBRA cryptocurrency, is attempting to dismiss a class-action lawsuit filed against him in New York. The lawsuit accuses Davis of misleading buyers and siphoning over $100 million from the project, claiming it was meant to economically support Argentina.

On Thursday, Davis filed a motion to a federal court in New York asking for the case to be thrown out, arguing that the court lacks jurisdiction. 

“Davis does not reside in New York, does not transact business in New York, was not physically present in New York when the allegedly tortious conduct occurred,” the filing stated. It added that he “made no specific effort to advertise to or serve the New York market in connection with the worldwide offering of $LIBRA meme coins.”

Project was ‘conceived in Argentina,’ Davis says

In his defense, Davis insisted that the LIBRA initiative had no direct connection to New York. “The project was conceived of in Argentina,” he asserted in the court filing, telling prosecutors that it was “offered to any buyer worldwide” and not marketed to any specific jurisdiction.

The motion is also seeking to nerf the project’s online presence, describing its website as “passive” and saying it “does not knowingly transmit goods or services to users in other states.” Davis claimed the site’s function was limited to “collecting applications from businesses in Argentina.”

The plaintiffs allege that Davis, along with his brothers and fellow Kelsier Ventures co-founders Gideon and Thomas Davis, built LIBRA under the false promise of boosting Argentina’s economy. 

The lawsuit reiterated that the real intent was to drain money from one-sided liquidity pools and move more than $100 million into wallets controlled by the Davis family and their associates. It blames the defendant for making public statements that helped build trust around the token, including a promise that he would repurchase certain LIBRA tokens to support their value. 

Still, Davis countered the allegations in the court filing, saying such statements were not directed specifically at New York residents and that the complaint “does not allege that Davis was physically present in New York when he made any such statements.”

In May, the plaintiffs secured a temporary court order requiring Circle, the issuer of the USDC stablecoin, to freeze approximately $57.65 million in assets allegedly tied to the LIBRA project. At its peak, LIBRA had a market cap of $4.6 billion before crashing by 94%, leaving thousands of investors in the red.

The class-action suit also names other entities believed to be linked to the LIBRA operation, including blockchain company KIP Protocol and its CEO Julian Peh, and crypto platform Meteora, alongside its co-founder Benjamin Chow.

Suspicious transactions from Davis and President Milei

In other related news, blockchain forensics sleuth Fernando Molina testified before Congress on Thursday about large transfers from wallets linked to Davis. Molina mentioned several transactions timed around certain points in the LIBRA scandal and its political ties in Argentina.

On January 30, the same day Davis met with Argentine President Javier Milei at the Casa Rosada, Davis transferred $507,500 via the Bitget exchange just 40 minutes after Milei posted a photo with Davis on X. 

Another suspicious transaction took place on February 13, a day before LIBRA’s launch. According to Molina, Davis sent $1.275 million to an exchange platform “he does not usually use.” 

“The source wallet was the same wallet that returned the money to Dave Portnoy,” he told lawmakers, referring to the US crypto entrepreneur who distanced himself from the project before it fell.

On February 3, Davis made another large transaction of $1.991 million to a different wallet. The following day, trader Mauricio Novelli, supposedly Davis’s connection to Milei, opened two safe deposit boxes at Banco Galicia’s Martínez branch. Molina asserted that these boxes “would later have been emptied by his mother and sister.”

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