July 19, 2024

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Lawsuit Against GameStop Trader Roaring Kitty Dismissed Just Days After It Was Filed

Lawsuit Against GameStop Trader Roaring Kitty Dismissed Just Days After It Was Filed

On Friday, a class action lawsuit was filed against Keith Gill, known as Roaring Kitty, alleging that his popular social media activities drove up the price of GameStop (GME) stock for personal gain. The plaintiffs voluntarily dismissed the lawsuit on Monday.

The case, Radev v. Gil, was effective. In the court record for one business day — and was withdrawn hours after the court issued a summons to Gill demanding he respond to the complaint within 21 days.

The two-sentence notice from the plaintiffs’ attorneys notified the court that the case was being dismissed without prejudice.

The news broke shortly before markets closed in the US, with GME stock ending the day at $23.33, down 5% on the day and 16% over the past month.

The rapid turnaround is another short chapter in the colorful and often chaotic story of Gill, who first rose to fame in 2021 as a leader in the early “meme stock” movement. Individual investors, who gained access to the stock market through apps like Robinhood, rallied behind shares of companies like GameStop, confounding Wall Street.

In the now-dropped lawsuit, plaintiffs recounted Gill’s role in the stock market’s 2021 rally, then traced his activities earlier this year, from his return to Twitter in May to his return to Reddit in June, and attempted to link his social media posts — and subsequent disclosures of stock and options holdings — to the volatile movements of GME stock.

The lawsuit included a slew of screenshots of Twitter images and Reddit posts. The plaintiffs even cited reports that financial regulators were investigating Gill’s activities, and that ETrade was considering kicking him off its trading platform.

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Ultimately, the lawsuit alleged that Gill “engaged in a pump-and-dump scheme” of GameStop stock, violating federal securities laws and causing “significant losses and damages” to victims who “acquired GameStop securities at artificially inflated prices.”

Since the case was dismissed without prejudice, that does not prevent the plaintiffs from refiling their lawsuit against Gill at a later date.

Meanwhile, Gill appears to have shifted his focus of affection from GameStop to online pet food retailer Chewy — revealing Monday that he bought 9 million shares of the company last month.

Gill and the plaintiffs’ law firm did not immediately respond to a request for comment from Decrypt.