Uniswap Labs and founder Hayden Adams prevailed in a four-year class-action suit alleging the platform was liable for scam tokens traded on Uniswap. Manhattan federal judge Katherine Polk Failla dismissed the case with prejudice Monday, finding the plaintiffs could not hold Uniswap responsible for misconduct by unknown third-party token issuers.
The class, led by Nessa Risley, amended its complaint in May to emphasize state consumer-protection claims, contending Uniswap enabled “rug pulls and pump-and-dump schemes.” The group originally sued Uniswap, Adams and venture firms Paradigm, Andreessen Horowitz and Union Square Ventures in April 2022; that suit was dismissed in August 2023 and that dismissal was later upheld on appeal.
Judge Polk Failla wrote that plaintiffs failed to plausibly allege Uniswap “had knowledge of the fraud and substantially assisted in its commission.” She said merely creating an environment where fraud could occur is not the same as affirmatively assisting it, comparing the situation to banks that do not substantially assist money launderers or messaging services that do not substantially assist drug dealers simply because such actors use their platforms.
Adams posted on X that the ruling was “a good, sensible outcome,” arguing that open-source developers should not be held liable when scammers use their code. The decision sets a precedent that platforms providing neutral, general-purpose services are not automatically liable for third-party illicit uses.
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