Investors File Lawsuit Against $HAWK Token Creators

In a stunning legal development, investors have filed a lawsuit against the creators of the controversial meme coin linked to Haliey Welch, the internet sensation known as the “Hawk Tuah” girl. The legal action comes after the coin, named the $HAWK Token, experienced a catastrophic collapse just hours following its launch on December 4, 2023.

Haliey Welch: From Viral Sensation to Token Endorsement

Welch, 22, gained notoriety earlier this year after a provocative comment on a TikTok video ignited a viral frenzy, leading her to monetize her newfound fame through merchandise and a podcast titled "Talk Tuah." The meme coin was heavily promoted by Welch to her 2.6 million Instagram followers and on her podcast, drawing significant initial interest from investors.

The Lawsuit Details

Court filings reveal that the lawsuit, submitted to the US District Court for the Eastern District of New York, accuses the defendants—Tuah The Moon Foundation, overHere Ltd, its founder Clinton So, and social media influencer Alex Larson Schultz (aka Doc Hollywood)—of misleading investors by falsely portraying the $HAWK Token as a registered security, which it allegedly was not. Notably, Welch herself has not been named as a defendant in the lawsuit.

Initial Success and Rapid Decline of $HAWK Token

The coin initially boomed, boasting a market cap of $490 million. However, it dramatically plummeted by over 90%, dropping to under $100 million within hours, leaving many investors in the lurch. According to the complaint, the pre-launch sale raised around $2.8 million at a valuation of $16.69 million, with the plaintiffs claiming to have lost more than $151,000 as a result of the coin's disastrous performance.

Clinton So's Controversial Moves

Following the botched launch, Clinton So reportedly transformed the Tuah Foundation into an offshore entity, selling 17% of the tokens to a select group, a move described in the lawsuit as a strategy to circumvent U.S. securities regulations, while continuing to promote the remaining 83% without taking adequate measures to ensure that U.S. investors were excluded.

Claims of Exploitation and Legal Complications

“The project was clearly intended to exploit the American market,” the lawsuit contends. Furthermore, the plaintiffs argue that So explicitly claimed token holders would function as shareholders, an assertion complicating the legal landscape surrounding the coin's legitimacy.

Defensive Statement from OverHere Ltd

In a statement to Bloomberg, a spokesperson from overHere defended their actions, insisting their involvement with the $HAWK Token was transparent and that they believed they had acted within legal bounds.

Welch's Silence Amid Controversy

Despite the upheaval surrounding the coin, Welch has chosen to remain silent, not addressing the controversy on her social media platforms or through her podcast since the crash, leaving her fans and investors speculating about the future implications of her association with the failed token.

Conclusion: What Lies Ahead for Investors?

Will investors see their lost funds returned, or will this be a cautionary tale of the volatility that often plagues the world of cryptocurrencies? Only time will tell as the lawsuit unfolds.