At Ripple opponent in SEK the case has been the talk of the town for some time now. The crypto community is focused on seeing how cases related to offering cryptocurrency as a security – will be dealt with in court. But the lesser -known case can only provide the first clarity – the SEC claims LBRY scheduled for trial in September 2022.
The second problem
In 2021, the SEC filed a complaint against LBRY, Inc. where the SEC according to him if LBRY violates the Securities Act of 1933. “Defendant” offered unlisted securities when he sold “LBRY Credit” to many investors. Includes investors based in the United States, without SEC registration. As alleged, LBRY received more than $ 11 million in U.S. dollars, Bitcoin, and services from buyers on offer.
On its answer, last year, LBRY pushed back on the agency’s claims and outlined several affirmative action defenses including selective enforcement defenses and violation of equal protection under Fifth Amendment allegations. Furthermore, it grants, not sells LBC tokens, to third parties to achieve the Foundation’s goals.
Now, LBRY has it filed ‘Reply Memorandum’ to support further of the motion for Summary Judgment as highlighted by James Filanwell -known lawyer in a June 11 tweet.
#XRPCommunity #SECGov v. #Ripuk #LBRY In the case of LBRY, LBRY has filed a Reply Memorandum in Further Support of the Motion for Summary Judgment. https://t.co/XiazjF7Tfp
-James K. Filan 🇺🇸🇮🇪101k+ (beware of imposter) (@FilanLaw) June 11, 2022
In his argument, Defendant claimed that the economic reality “was indistinguishable from the sales contained in the Previous Commission. Chapter 5 case. ” Further added:
“Ignoring the essence of the LBRY summary, the Commission characterizes the LBRY argument as a“ formalistic approach ”that only looks at what“ the defendant did to the ICO and issued a white paper.
But LBRY never suggested this narrative. ‘No ICO necessarily means the sale of certain digital assets’ cannot be an investment contract. However, LBRY distinguishes LBC sales from previous sales Chapter 5 case.
In contrast to Plaintiff’s statement of ‘minimum utility value’, the submission states a different scenario. Evidence and sworn declarations filed by LBRY show that> 1000 people use LBC for transactions on the LBRY Network on a daily basis. Attributes that the Commission (Plaintiff) cannot dispute for utility purposes.
Implications?
The LBRY court recently denied the SEC’s request to extend the trial date by approximately one month. This means that, unless there is an additional schedule change, the LBRY case will be decided prior to the SEC’s lawsuit against Ripple Labs for failing to register an offer and sell XRP.
This is important because the court’s findings in the LBRY case can be traced back to the Ripple case. In fact, the SEC try to include the verdict in the LBRY case is a precedent against Ripple Labs in the Ripple case.
