The team behind the memecoin HAWK, tied to Haliey Welch or "Hawk Tuah Girl," has been sued by investors for alleged securities law violations, according to court documents.
The complaint filed in a District Court of New York Thursday claims that HAWK behaved as an unregistered security, drawing in first-time cryptocurrency investors who subsequently experienced "substantial damages" following the token's decline. Twelve plaintiffs who invested in HAWK, collectively experiencing a financial loss of $151,000, brought the complaint forward and requested a jury trial.
"The $HAWK Token exhibits all the characteristics of an unregistered security under established legal precedent," states the complaint, noting that a common enterprise existed with the token due to "the pooling of funds and the Token’s success being tied to the collective efforts of Welch." Additionally, marketing efforts surrounding HAWK provided "reasonable expectation of profits," and the token's success relied on Welch and her project team's efforts, the plaintiffs contended.
"Despite these clear indications of its status as a security, the $HAWK Token was not registered by Defendants," the complaint continues. In addition, it claims that a wallet controlled by the Tuah Foundation collected $3 million from token transaction fees.
Welch gained viral popularity for her response, including the phrase "hawk tuah" in a street interview in June 2024. The web3 launchpad platform OverHere facilitated HAWK's launch on Dec. 4 on Solana. The token surged to a market capitalization of around $400 million before falling 90%, The Block previously reported.
The Block reached out to OverHere for comment.
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