Pump.fun and Solana face long legal battle as class action lawsuit proceeds

Judge Colleen McMahon has issued an order to grant plaintiffs in the lawsuit against Pump.fun and Solana leave to file a second amended complaint (SAC). This development comes after the plaintiffs filed a motion to amend in September, citing new evidence that reportedly came from a confidential informant. 

The lawsuit covers those who purchased Pump.fun-launched tokens from March 2024 onward and suffered out-of-pocket losses.  

The defendants have attempted to dismiss the motion citing legal technicalities, but the court has upheld the motion and given the plaintiffs time to incorporate the new evidence, which means the battle is about to begin anew.

What’s the new evidence in the Solana, Pump.fun class action lawsuit? 

The claims included in the recently released court documents, which have granted the plaintiffs leave to file an amendment, range from violation of the securities act to RICO violation and unjust enrichment allegations. 

“What appeared to be a fair, automated marketplace was, Plaintiffs say, structurally tilted to extract value from ordinary users while rewarding those with privileged access to Solana’s infrastructure and Jito Lab’s transaction ordering tools,” the documents claim. 

The plaintiffs allege they got their hands on after an informant who had gone missing reached out, claiming to have incriminating chat logs of up to 5000 messages. 

Going by the new evidence, the court deemed the proposed amendments sufficient enough to proceed and has denied or deferred related defense motions as needed.

The internal chat logs that are expected to be presented as evidence involve Pump.fun personnel, Solana Labs engineers, Jito Labs executives and other third parties. 

The defendants have asked that the motion be denied outright because the plaintiffs did not attach a proposed amended complaint, but the court countered the proposition, and the leave to file a second amended complaint was granted. 

The plaintiffs have also requested a corresponding schedule modification to allow them sufficient time to process the new evidence and incorporate it into the second amended complaint they plan to file. 

The filing has not happened yet, but when it does, the pending motions to dismiss the current complaint from September 2025, which currently remain, may become moot or get reset. 

In summary, the battle has only just begun, and its outcome is likely to affect the entire Solana ecosystem. 

Why are Solana and Pump.fun getting sued? 

The origin of the Solana, Pump.fun lawsuit goes back to the beginning of the year when a class action lawsuit was filed by retail investors who had lost money on memecoin purchases. 

The lawsuit saw the plaintiffs accuse the Pump.fun platform, its co-founders, Solana Labs Inc., the Solana Foundation and associated executives, which include the likes of Anatoly Yakovenko, Raj Gokal, Dan Albert, Austin Federa, and Lily Liu, of orchestrating a plan to extract value in what was called the “Pump Enterprise.” 

The core allegations leveled against the defendants now claim they rigged token launches in a way that secretly granted insiders priority access to purchase newly launched tokens, all of which the plaintiffs claim would be impossible to do without Solana’s validator infrastructure and transaction ordering tools. 

This arrangement allegedly gave those insiders the chance to buy as many of the new tokens at the lowest possible prices, trigger rapid price spikes via the bonding curve mechanism the Pump platform integrated, and subsequently dump on retail buyers who placed an order thinking they were playing on a level playing field. 

This meant the retailers bought at inflated prices, which ultimately resulted in widespread losses each time the price collapsed. 

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Source: https://www.cryptopolitan.com/pump-fun-solana-class-action-lawsuit/