A US court will again be asked to weigh in on maximum extractable value practices after a judge allowed latest evidence to be added to a category motion lawsuit involving a memecoin platform.
The judge granted a request to amend and refile a category motion lawsuit against memecoin launch platform Pump.fun, maximum extractable value (MEV) infrastructure company Jito Labs, Solana Foundation, the nonprofit behind the Solana ecosystem, and others to incorporate latest evidence.
The motion states that in September a “confidential informant” submitted over 5,000 pieces of evidence in the shape of internal chat logs that had not previously been available. The file said:
“Plaintiffs allege that the minutes contain contemporaneous discussions between Pump.fun, Solana Labs, Jito Labs and others concerning the alleged plan and that they materially make clear the corporate’s management, coordination and communications.” The first page of the motion to amend the case to incorporate latest evidence, which was granted. Source: Burwick Law
The lawsuit, originally filed in July, alleges that the Pump.fun platform intentionally misled retail investors by marketing Memecoin launches as “fair,” but engaged in a scheme with Solana validators to push retail participants to the highest through maximum extractable value (MEV).
Maximum Extractable Value is a method that rearranges transactions inside a block to maximise profits for MEV arbitrageurs and validators.
The plaintiffs allege that Pump.fun used MEV techniques to provide insiders preferential access to latest tokens at a low value, which were then pumped and dumped to retail participants, utilized by insiders as exit liquidity.
Cointelegraph reached out to Burwick Law, the law firm representing the plaintiffs, in addition to Pump.fun, Jito Labs and the Solana Foundation, but didn’t receive responses on the time of publication.
The allegations in the unique grievance. Source: Burwick Law
The lawsuit could set a precedent for MEV cases within the United States, because the ethics of this practice proceed to be debated within the crypto industry and legal authorities struggle to define appropriate regulations on this highly technical issue.
The MEV bot test leaves questions unanswered
Anton and James Peraire-Bueno, the brothers accused of creating hundreds of thousands of dollars in profits using an MEV trading robot, went on trial within the US in November.
Prosecutors argued that the brothers defrauded the victims of their funds, but defense attorneys said they were pursuing a legitimate trading strategy and did nothing illegal.
The jury struggled to succeed in a verdict within the case, with several jurors requesting additional information to make clear the complexities of the technical specifics of blockchain technology.
