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Keith Gill, recognized as Roaring Kitty, faces allegations of securities fraud in a class-action lawsuit related to GameStop. The suit claims that his social media activity induced fluctuations in GameStop stock prices during May and June.
This legal action was initiated on June 28 in the Eastern District of New York against Gill, who gained notoriety for his role in the 2021 GameStop short squeeze.
In May, the trader made his initial meme posts on his X account after a three-year hiatus. The filing indicates that this post was perceived as Gill re-engaging with GameStop securities.
Subsequently, in early June, he revealed a substantial investment in the company through a Reddit post. He disclosed ownership of 5 million GameStop shares and 120,000 GameStop call options with a strike price of $20. This announcement caused GameStop shares to rise over 70% in early premarket trading on June 3.
Roaring Kitty/Deep Fucking Value is being sued for securities fraud. This is a class action lawsuit, filed by a person who bought GME at what they claim was an artificially inflated price.https://t.co/0Opn8i7zVA
— Chairman Birb Bernanke (@Bonecondor) June 30, 2024
Roaring Kitty Faces Legal Battle for Alleged GameStop Market Manipulation
Additionally, the lawsuit asserts that Gill attempted to manipulate GameStop’s stock prices. Shortly thereafter, E-Trade reportedly contemplated removing him from its platform due to concerns regarding stock manipulation.
On June 13, Gill announced the acquisition of an extra 4 million GME shares valued at $262 million.
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The plaintiffs subsequently contended that Gill was involved in a pump-and-dump scheme, leading to losses for other investors.
“[Gill] circulated and disseminated the false and misleading information with the purpose and to the effect that the price of GameStop securities would or was likely to rise,” the complaint states. The plaintiffs are now pursuing a court trial.
However, litigation firm Dynamic LLP believes the case lacks a solid basis. It is likely to be dismissed if Gill mounts a robust legal defense, they stated.
From Reddit to Congressional Spotlight
So who is Keith Gill?
In 2021, Gill, a financial analyst turned Reddit investor known as “Roaring Kitty,” emerged as a key figure in the GameStop short squeeze.
He asserted that the video game retailer was undervalued. The trader sparked a wave of retail investor enthusiasm for the stock through his posts on Reddit’s r/wallstreetbets. Ultimately, this propelled the stock’s price up by 1600% and squeezed hedge funds that were betting against it.
Gill later testified before Congress, reaffirming his position as a dedicated investor who recognized value in GameStop.
The post Roaring Kitty Sued Over GameStop Pump-and-Dump Allegations appeared first on Cryptonews.
