A federal judge has dismissed all claims against Solana Labs, the Solana Foundation, and the named executives connected to them in the Pump.fun class action lawsuit.
Judge Colleen McMahon of the U.S. District Court for the Southern District of New York issued the 79-page ruling on August 31, granting defendants’ motions to dismiss in part and denying them in part. The decision leaves a narrower case focused on Pump.fun operator Baton Corporation Ltd. and its 3 founders, Alon Cohen, Dylan Kerler and Noah Tweedale.
The lawsuit began in January 2025 after plaintiffs alleged that Pump.fun facilitated a scheme that favored insiders through advance token positions, coordinated promotion and subsequent selling into retail demand. Plaintiffs estimated that retail traders collectively lost between $4 billion and $5.5 billion trading Pump.fun tokens.
$FRED and $GRIFFAIN Fail the Securities Test
The ruling also rejected the plaintiffs’ Securities Act claims involving the 2 tokens they actually purchased, $FRED and $GRIFFAIN.
Judge McMahon did not rule that memecoins can never qualify as securities. Instead, she found that the complaint failed to establish a "common enterprise" under the Howey test.
The plaintiffs argued that $SOL deposited into each token’s bonding curve created a common pool. The judge disagreed, finding that the bonding curve did not connect investors to an underlying venture whose success or failure determined their collective fortunes. Early buyers could profit by selling to later buyers, while later purchasers could lose when demand declined.
The court dismissed the securities claims involving $FRED and $GRIFFAIN with prejudice. Claims involving the other 18 tokens failed because the named plaintiffs lacked class standing to pursue tokens they had not purchased.
That distinction matters. The ruling does not establish that all memecoins fall outside securities laws. It addresses the specific allegations surrounding $FRED and $GRIFFAIN, which were the tokens the plaintiffs actually purchased.
Pump.fun Still Faces RICO Claims
The decision leaves the most consequential part of the lawsuit alive. The plaintiffs can continue pursuing substantive RICO and RICO conspiracy claims against Baton, Cohen, Kerler and Tweedale. The court found that the plaintiffs adequately pleaded wire-fraud allegations and a direct connection between the alleged conduct and transaction-fee losses.
The gambling theory did not survive. Judge McMahon concluded that buying and selling memecoins, although risky, does not constitute placing a bet under New York law.
The ruling also rejected the RICO claims against the Solana Defendants. The court found no adequately pleaded predicate racketeering act by Solana Labs, the Foundation, or their named executives.
Discovery and the September 10 Deadline
The case now moves forward primarily as a RICO dispute against Pump.fun's operator and its 3 founders. Plaintiffs previously obtained nearly 5,000 internal chat messages and amended their complaint using that material.
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The court also ordered the plaintiffs to explain why 25 unidentified Lead KOL defendants should not face dismissal. They have until September 10 to identify any defendants they have located, explain their efforts to serve them, and identify any discovery they need to determine their identities. Failure to respond could lead to dismissal of those claims.
Pump.fun Keeps Building
The ruling arrives as Pump.fun continues expanding its product. The memecoin launchpad announced the introduction of limit orders on Solana on its mobile app, including take-profit and stop-loss functionality. Co-founder Alon lauded it as “the FIRST memecoin trading mobile app that supports limit orders”, adding that EVM-chain support for limit orders would follow.
The pump.fun mobile app has consistently hit new all-time highs in daily active app traders, according to Sapijiju, another pseudonymous co-founder of pump.fun. He also reported that the app crossed 100,000 daily active users this week, highlighting the platform's continued growth, which has amassed over $1.4 billion in lifetime revenue.
The legal fight therefore narrows, but it does not disappear. Solana has exited the claims against it, the securities theory has collapsed for the 2 tokens at issue, and the gambling theory has failed. The remaining RICO allegations against Pump.fun and its founders now face discovery, where the parties will have to test the allegations against evidence before going to trial.
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