Memecoin
Investors Sue Healy Welch Over Alleged Fraud
Is HAWK's memoir just another celebrity cash grab, or something more sinister?
$HAWK crypto memecoin investors sue promoters for alleged illegal sales and compliance violations.
$HAWK's 95% drop in value fuels rug-pulling accusations and investor anger.
The controversy surrounding “Hawk Tuah Girl” — Hayley Welch — has taken a legal turn. Investors are now suing individuals and entities associated with the now-defunct $HAWK note.
The token, which dropped more than 95% in value on its launch day — December 4, has been at the center of allegations of illegal promotion and sales practices.
Stuffing Against Haley Welch and Associates
In a filing dated December 19 by Burwick Law, the defendants accused investors of violating regulations by offering and selling the token to the public without proper registration.
The lawsuit alleged that aggressive promotional efforts initially drove up the token's market value, only to have it plummet shortly after launch.
The recording said,
“Through aggressive promotional campaigns and promises of future growth, the defendants created a speculative frenzy that caused the Token’s market value to skyrocket shortly after its launch, reaching a significant market capitalization.”
I also noticed,
“Defendants leveraged Welch’s celebrity status and connections to enhance Token’s credibility and appeal, including discussing the $HAWK project during Welch’s podcasts featuring prominent guests.”
However, the lawsuit named several defendants. This included the Tuah The Moon Foundation, which is accused of managing the proceeds from the token sale, along with the coin’s creator, OverHere Ltd, and its CEO, Clinton Su.
Additionally, Los Angeles-based promoter Alex Larson Schultz has been named as a lead defendant in the case.
It is worth noting that the rapid decline of the $HAWK crypto, where it lost 95% of its value from a peak market cap of $490 million, has sparked allegations of a rug-pulling and intensified scrutiny of its legitimacy.
The discovery of linked wallets holding 96% of the token supply, some of which have begun to unload tokens, has further angered investors.
However, despite these concerns, Welch defended the project, insisting that it was not just a cash grab.”
Its director, Johnny Forster, echoed this sentiment, highlighting plans to distribute free tokens to fans as a means of engagement rather than encouraging outright purchases.
Despite the efforts, the token's collapse left many questioning the project's true intentions.
What awaits us?
Now, with the legal battle unfolding, the defendants, including Welch, will have a chance to respond to the allegations. Needless to say, a summary judgment motion may follow, which could lead to a pretrial phase if the motion is denied.
The plaintiffs sought a jury trial. If granted, it could result in a jury determining damages if the suit is successful.
Regardless of the outcome, the case underscores the risks associated with celebrity-endorsed cryptocurrency projects and raises broader concerns about transparency and accountability in the crypto space.
Recalling this, Ethereum (ETH) co-founder Vitalik Buterin also recently criticized celebrity-endorsed memoirs, calling for more meaningful crypto projects.