Uniswap wins full dismissal in long-running scam token class action

A federal judge has dismissed the remaining state-law claims against Uniswap Labs and founder Hayden Adams, ending a long-running class action that sought to hold the decentralized exchange developer liable for scam tokens traded on its protocol.

In an opinion issued Monday, Judge Katherine Polk Failla of the U.S. District Court for the Southern District of New York dismissed the second amended complaint with prejudice, ruling that plaintiffs cannot hold the company responsible for misconduct by unidentified third-party token issuers.

The plaintiffs alleged losses from so-called "rug pulls" and pump-and-dump schemes and argued that Uniswap facilitated fraud by providing a marketplace that brought together buyers and sellers of tokens. The court rejected that theory, writing that simply offering a platform does not amount to substantial assistance of fraud.

Failla reiterated her earlier reasoning that it “defies logic” to hold a drafter of smart contract code liable for a third party’s misuse of a decentralized platform.

'Good, sensible outcome'

The case was first filed in 2022 and initially included federal securities claims. Those claims were dismissed in 2023, a decision later affirmed by the Second Circuit, which sent the remaining state-law claims back to the district court for review.

Monday’s ruling closes that final chapter, with the court finding plaintiffs failed to plausibly allege actual knowledge of fraud, deceptive conduct under state consumer laws, or unjust enrichment.

In a post on X, Uniswap Labs General Counsel and Head of Policy Brian Nistler described the ruling as "another precedent-setting" decision for decentralized finance, noting that the court again rejected attempts to hold developers liable for third-party misuse of open-source code.

Adams wrote in a separate post on X that if open-source smart contract code is used by scammers, "the scammers are liable, not the open source devs," and called the ruling a “good, sensible outcome.”

Uniswap’s native UNI token rose 6% on the day to $3.92, extending gains amid a broader crypto market rally.