The U.S. District Court for the Southern District of New York dismissed a class action lawsuit filed against Uniswap Labs, its CEO, its foundation, and venture capital backers by plaintiffs who claimed they lost money due to fraudulent tokens on the decentralized cryptocurrency exchange. The lawsuit was filed by six people who purchased tokens on Uniswap between December 2020 and March 2022.

The plaintiffs alleged that Uniswap Labs controlled the protocol's liquidity pools, including those created by fraudsters. The plaintiffs argued that Uniswap held “liquidity provider funds and newly created tokens in Uniswap’s proprietary core contracts,” used routers it controlled to process transactions in the protocol, and issued liquidity tokens when pools were created.

The judge said neither party knew the scammers' identities, and rather than suing the scammers for the illegal solicitation, the plaintiffs sued the defendants for statements made on social media. The judge stated that it would be better if the plaintiffs' concerns were appealed to Congress before this Court.

The judge ruled that the case should be dismissed with prejudice, meaning that the case would not be retried. Community commenters welcomed the decision as demonstrating a significant depth of understanding of decentralized finance.