Caitlyn Jenner Wins $JENNER Memecoin Lawsuit as Federal Court Rules Token Is Not a Security

TLDR:

• A California federal court dismissed all Securities Act claims against Caitlyn Jenner over the $JENNER memecoin on April 16, 2026.
• The court ruled the $JENNER Ethereum token failed the Howey test due to lack of horizontal and vertical commonality among investors.
• Jenner’s 3% transaction tax gave her independent income regardless of investor losses, defeating vertical commonality claims in court.
• State law claims for fraud and quasi contract were dismissed without prejudice, leaving Greenfield the option to refile in California state court.

Caitlyn Jenner wins lawsuit after a California federal court dismissed all securities claims tied to the $JENNER cryptocurrency token.

Lead plaintiff Lee Greenfield had sued Jenner and her manager Sophia Hutchins, alleging the token was an unregistered security.

The U.S. District Court for the Central District of California ruled on April 16, 2026, that the Ethereum-based token did not meet the legal definition of a security. Greenfield had lost over $40,000 in the investment.

Judge Rules $JENNER Token Fails the Howey Test for Securities

The court applied the longstanding Howey test to determine whether the $JENNER token qualified as an investment contract.

That test requires proof of a common enterprise and an expectation of profits from others’ efforts. Greenfield could not satisfy either requirement, and the court dismissed the Securities Act claim with prejudice.

Greenfield argued that all token holders experienced identical percentage gains and losses, proving horizontal commonality.

The court disagreed, stating that parallel price movement does not substitute for pooling of investor funds. The SAC itself acknowledged that cryptocurrencies like the $JENNER token “lack utility other than as a store and transfer of value.”

Jenner and Hutchins made no development commitments behind the $JENNER token. Defendants described it plainly as “a memecoin on the Ethereum blockchain intended solely for entertainment purposes.” No funds were raised to build any product, software, or ecosystem connected to the token.

Jenner’s promotion included an AI-generated tweet image of her in a “JENNER ETH” T-shirt carrying an American flag.

A crowd member in the image held a sign reading, “LETS MAKE EVERYONE RICH!” Hutchins further promoted the project by touting Jenner’s ability to “bring attention and investors into the project,” citing her awards, fame, and powerful connections.

The court ruled that promotional activity alone could not replace the pooling structure that securities law requires.

Jenner’s Transaction Tax Seals Vertical Commonality Argument Against Plaintiff

Greenfield also pursued vertical commonality, pointing to Jenner’s holdings of over 20 million $JENNER tokens. He argued her financial stake linked her fortunes directly to those of investors. The court found otherwise, citing her 3% transaction tax as a decisive factor working in Jenner’s favor.

During a Twitter Spaces chat, Jenner said tax proceeds would fund Trump campaign donations, buybacks, and marketing.

When an X user pushed back, writing, “Use half of the taxes for buybacks. The community doesn’t like to just fund Trump. It would be fair to do half and half,” Jenner responded, “Not all taxes going for Trump.

The first distribution would be made when we hit 50m MC. And never said it would be ALL of them. Some have been used for buybacks, marketing, etc.” The court treated these statements as too vague to constitute meaningful managerial commitments.

Critically, the tax paid Jenner on every transaction whether investors profited or not. Under the Ninth Circuit’s ruling in Brodt v. Bache & Co., a promoter must share in investor losses for vertical commonality to exist.

The court noted that Jenner “kept hundreds of thousands of dollars in tax revenues for herself even as the investments of Greenfield and others became nearly worthless.” Because Jenner faced no downside risk tied to investor outcomes, the vertical commonality standard was not met.

With no viable federal claim remaining, the court declined jurisdiction over Greenfield’s state law claims for fraud and quasi contract. Those claims were dismissed without prejudice, allowing him to refile in California state court.

The court also denied any further attempt to amend the Securities Act claim, finding such an amendment would be futile. Jenner’s legal victory draws a clear legal boundary between celebrity-promoted memecoins and regulated securities.

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