Lawsuit filed against Hailey Welch's Hawk Tuah memecoin weeks after rug pull accusations 

Investors have filed a lawsuit against entities associated with the cryptocurrency launched by social media personality Hailey Welch, widely known as the "Hawk Tuah Girl." The legal filing stemmed after the memecoin Hawk Tuah, known as $HAWK, saw its value plummet by over 95% on December 4, 2024, the day of its release.

As per Newsweek, in a court filing submitted on December 19, 2024, the investors' legal representatives stated that the lawsuit:

"arises from the unlawful promotion and sale of the Hawk Tuah cryptocurrency memecoin, known as the '$HAWK' token (the 'Token' or '$HAWK'), which Defendants offered and sold to the public without proper registration."

The lawsuit names several defendants, including Tuah The Moon Foundation, which managed the proceeds from the token's sale, OverHere Ltd, the coin's creator, its executive Clinton So, and Los Angeles-based promoter Alex Larson Schultz. Welch herself is not listed as a defendant.

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Hailey Welch's role in promoting the $HAWK token

Hailey Welch gained viral fame for coining the onomatopoeic phrase "hawk tuah" in a YouTube video, which she humorously described as mimicking a spitting action in a s*xual context.

Leveraging her online popularity, Welch launched a merchandise line and a podcast, Talk Tuah, where she has interviewed high-profile figures, including entrepreneur Mark Cuban. As per Newsweek, the plaintiffs' lawyers said that the lawsuit alleges:

"Through aggressive promotional campaigns and promises of future growth, Defendants created a speculative frenzy that caused the Token's market value to spike shortly after launch, reaching a significant market capitalization."

The filing also claimed that Welch's celebrity status and business ventures, including podcast discussions about the $HAWK project, were instrumental in bolstering the token's appeal.

Memecoins are cryptocurrencies often built around internet memes or jokes, with minimal intrinsic value. In this case, the $HAWK token was heavily promoted using Welch's social media influence. Although Welch is not directly implicated in the lawsuit, the filing claimed that the defendants:

"leveraged the extensive social media following of Hailey Welch, a prominent social media personality known as the 'Hawk Tuah Girl,' to market the Token as a groundbreaking cryptocurrency project."

The plaintiffs' legal team contended that many investors were first-time cryptocurrency participants attracted by Hailey Welch's involvement. They also argued that the token's rapid loss of value inflicted substantial financial harm on investors who had trusted the project's roadmap and Welch's public association with it.

Attorneys from Wolf Popper LLP and Max Burwick of the Burwick Law Firm are handling the lawsuit.

During an interview with Fortune on December 4, 2024, Hailey Welch dismissed allegations that $HAWK was a cash grab. She stated:

"This is not just a cash grab."

She explained that her interest in cryptocurrency was piqued after attending several conferences and recognizing its potential as a means of engaging with her fans.

Hailey Welch's manager, Jonnie Forster, clarified at the time that $HAWK's approach differed from other celebrity crypto ventures, according to Newsweek. He emphasized that the tokens were not marketed for purchase but were instead distributed for free to fans who followed Welch or purchased her merchandise.

Forster added that Hailey Welch would hold 10% of the token's supply, though she was contractually barred from selling any of it for one year.

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The defendants will now have the opportunity to respond to the lawsuit. They are expected to seek a summary judgment to dismiss the case. Should the court deny the summary judgment, pretrial motions will commence, with the plaintiffs seeking a jury trial. A jury would determine the damages to be awarded to investors if it is granted.