Keith Gill Briefly Faces Legal Heat Over His GameStop Shares

Behold: a memestock lawsuit even more ephemeral than the memestock craze itself.

On Friday, Keith Gill — a.k.a. Roaring Kitty, a.k.a. the king of the memestockers — got slapped with a lawsuit alleging a pump-and-dump scheme involving his GameStop shares. On Monday however, the lawsuit was voluntarily withdrawn by the plaintiff.

HODL Your Applause

Gill’s return to the public eye this summer has drawn attention for a reason. After becoming the face of the memestock short-squeeze craze that saw GameStop’s share price soar 1,700% over a stretch in January 2021, Gill quietly receded to his basement. Then on May 12, after nearly three years of silence, he began tweeting memes vaguely suggesting he was back in the game. Memestockers, unsurprisingly, took notice.

And that’s where the trouble started, according to the short-lived class-action lawsuit filed in a New York federal court by a GameStop shareholder:

• In the days following Gill’s reemergence, GameStop’s stock climbed 180%. On June 2, Gill revealed he owned 5 million GameStop shares and 120,000 call options set to expire on June 21, a stake worth around $116 million, sending shares soaring once again. On June 13, Gill revealed he had exercised all his call options, scoring millions in gains, before expanding his stake to 9 million shares.
• The mayfly lawsuit essentially alleged that by quietly amassing a huge stake before reemerging publicly, Gill sought to manipulate the stock for his own gain. It cited a “well-documented” history of Gill’s ability to “rally a massive following of retail investors to purchase and hold GameStop securities through his social media posts.”

The plaintiff GameStop investor didn’t immediately respond to enquiries from multiple news outlets on why he’d withdrawn the lawsuit, so his reasoning for filing and then almost immediately retreating remains a mystery.

Chew On This: The brick-and-mortar video game retailer isn’t the only object of Roaring Kitty’s affection. On Monday, Gill revealed a nearly 7% position in online pet-product retailer Chewy, which saw its stock climb to an all-time high in early 2021, coinciding with the memestock craze. The kicker? Chewy was founded by Ryan Cohen, a.k.a. the current CEO of GameStop.