In a surprising strategic maneuver, Coinbase put forward its first legal defense to the U.S. Securities and Exchange Commission (SEC) markedly ahead of the slated August 7 deadline, potentially hastening the judicial process. Their decision to file a response 40 days earlier forced the SEC to respond by July 3rd, three days later because of the July 4th holiday weekend. This “creative strategy,” described by confident legal minds, has transformed the pre-trial conference into a pre-motion conference, set for July 13th.
Coinbase has brought the legitimacy of SEC’s claims under scrutiny. The exchange claimed that numerous tokens flagged by the SEC fall outside the Commission’s control, violating due process and being an abuse of discretion. The substantial question of their defense rests on whether the subject matter extends beyond the jurisdiction of the SEC, as they argue. Immediate reflection on Coinbase’s defense strategy reveals an attempt to front-load beneficial documentation before the Judge through their early response.
However, it’s crucial to understand how the legal landscape changes with this tactic. A motion to dismiss allows a judge to review only factual allegations in the complaint and documents attached or referenced. With a motion for judgment on the pleadings, the judge can consider other pleadings filed, bringing the defendant’s Answer to the Complaint under consideration, a distinction pointed out by MetaLawMan, a legal pundit on Twitter.
The proceedings on July 13th will be under the discerning eyes of Judge Katherine Polk Failla, who will ascertain if Coinbase’s innovative motion will be allowed to proceed. Generally, permission is granted barring a far-reaching motive provided by the opposition, added MetaLawMan.
Though Coinbase’s preemptive and astute response brims with confidence, it also leaves one wondering. Is this aggressive early defense a credible reflection of their innocence? Or merely a strategic move to counter the SEC’s allegations more robustly? At this moment, the repercussions of this intriguing legal tangle are challenging to predict, and speculation is rampant. The SEC’s response, the Judge’s decisions, and Coinbase’s next steps will be scrutinized by the crypto community in the following days as the future of digital exchange regulation may depend on it.
Source: Coindesk
