The JENNER token debuted in May 2024 on the Solana blockchain via the memecoin platform Pump.fun, quickly catching the attention of crypto enthusiasts and investors. However, the launch soon became embroiled in controversy after Jenner and other promoters accused collaborator Sahil Arora of scamming them, alleging that he sold a large portion of the token holdings, causing a sharp decline in value. Despite these setbacks, Jenner and her team decided to relaunch the token on Ethereum, hoping to restore its previous momentum.

That Ethereum relaunch, however, did not provide the revival for which they had hoped. From an estimated nearly $7.5 million valuation, JENNER watched its market cap fall all the way to $170,000 by November 2024, with trading volume falling to a scant $1.80 in one 24-hour period. “Jenner appears to have all but abandoned the project, leaving holders on the hook for serious losses,” said one of the plaintiffs in the lawsuit.

Source: CoinGecko

Allegations of Misleading Statements and Omissions

Investors Naeem Azad of the UK and Mihai Caluseru of Romania filed a lawsuit on November 13, claiming they were duped into purchasing JENNER tokens on both Solana and Ethereum, losing over $56,000 as a result. According to the investors, Jenner, through her manager Sophia Hutchins, was involved in the fraudulent promotion of the token as an investment while failing to disclose critical information relative to the token’s unregistered status with the U.S. SEC.

In the complaint, Jenner “willfully failed” to register the token with the SEC, which in turn deprived investors of the risk disclosures they would have gotten had the token been registered. The plaintiffs believe they would not have invested in the token if they had been fully informed. “We were lured in by Jenner’s promises, but if we had known the true risks, we wouldn’t have bought into this,” said Azad.

The lawsuit also centers around Jenner’s decision to relaunch the token on the Ethereum blockchain, which, according to the plaintiffs, effectively “killed” the original Solana-based token. Along with this move, the relaunch introduced a 3% transaction fee, which the plaintiffs argue was never properly disclosed to investors. They allege that this “tax” was designed to enrich Jenner and her team at the expense of unsuspecting buyers.

“Jenner promised no relaunch of the token, but then went ahead with the Ethereum migration, which destroyed the value of the original token,” said Mihai Caluseru. Furthermore, the plaintiffs claim that Jenner’s failure to disclose important details, such as her own token holdings and the specifics of her relationship with Arora, contributed to their financial losses.

The class action was filed in California federal court and charges Jenner and Hutchins with security fraud, common law fraud, and a violation of securities laws. Aiding and abetting are attached to both of the aforementioned fraudulent activities involving Hutchins. Damages to compensate for the losses on behalf of the plaintiffs were pursued to rest on misrepresentation and lack of transparency regarding the sale of the token.

Neither Jenner nor her lawyers have commented on the lawsuit. The case has put a spotlight on the legal dangers of celebrity-endorsed cryptocurrencies and what duties celebrities bear for their promotions under securities laws. As for the future of the JENNER token, it remains to be seen whether the investors will ever recover their losses—or whether Caitlyn Jenner will be forced to answer for the financial fallout of this failed crypto venture.