In a stunning turn of events, "Roaring Kitty," the meme stock icon who catalyzed the GameStop frenzy earlier this year, has been hit with a securities fraud lawsuit. The lawsuit alleges that Keith Gill, the former financial analyst for MassMutual, engaged in a "pump-and-dump" scheme by failing to disclose crucial information about his position in GameStop.

According to the class-action lawsuit filed in Brooklyn federal court by several GameStop shareholders, Gill deceived his millions of internet followers by only revealing his stake in GameStop without disclosing when he purchased the options. The claim states that he "belatedly revealed" on June 13 that he had acquired a significant stake in GameStop, after previously announcing a $116 million bet on the company through a Reddit post on June 2.

The lawsuit further accuses Gill of quietly selling and exercising all of the 120,000 call options he had purchased, seemingly to increase his own stake in GameStop by over 4 million shares. These actions allegedly took place before his disclosure on June 13, by which time the company's stock price had skyrocketed by as much as 75%.

Gill's Reddit posts, which included screenshots of his E-Trade portfolio, showed that he owned 9.001 million shares of GameStop and over $6 million in cash. As of Monday, the company's shares were trading around $22.90, making Gill's stake worth an estimated $206.1 million.

The lawsuit seeks to hold Gill accountable for engaging in stock manipulation and deceiving investors. Despite the allegations, some legal experts have cast doubt on the merit of the case. Attorney Eric Rosen, not involved in the lawsuit, characterized Gill's social media posts as "completely innocuous" and argued that he had no duty to disclose his stock sales since he is not a fiduciary or financial advisor.

Interestingly, Gill had recently filed disclosure forms with the Securities and Exchange Commission, revealing a 6.6% stake in online pet goods retailer Chewy. This filing came just days after he posted an uncaptioned picture of a puppy on social media platform X. Following the news, Chewy's stock price experienced a notable surge in pre-market trading before experiencing a subsequent decline after the opening bell.

The Post has reached out to Gill and the attorneys representing the plaintiffs for comment. Additionally, E-Trade, which was previously reported to be considering removing Gill from its platform due to concerns of stock manipulation, has also been contacted for comment.

As the legal battle unfolds, the outcome will determine the implications of online influencers' impact on financial markets and shed light on the responsibilities associated with their disclosures.