In a recent high-profile legal skirmish, renowned attorney John Deaton has extended his considerable experience in championing the cause of XRP token holders against the SEC, to now supporting LBRY’s appeal case. In an unconventional move, Deaton adopted the role of “Amicus Curiae,” or “friend of the court,” his objective being to provide expert advice to aid the court in its judgement.
This move comes after LBRY, who were previously issued a damning judgement on July 11, mandating it to pay a civil penalty and cease its engagement in unregistered offerings of cryptocurrency securities, filed an appeal notice. The original case against LBRY was laid by the SEC in March 2021, accusing the company of unlawful sale of their LBC tokens without registering with the relevant authorities.
Despite the New Hampshire District Court imposing a hefty $22 million penalty on LBRY, with it cited that LBC was an unregistered security based on the Howey test, LBRY disputed this assertion, claiming that the penalty didn’t consider legitimate software development and hosting expenses. Following its defeat in the legal challenge in July 2023, LBRY announced its intention to gradually wind down operations. Ultimately, the company ended up being ordered to pay a scaled-down penalty of $111,614 and was immediately restricted in carrying out activities involving potential securities law violations.
And yet, despite the setback, an air of optimism is beginning to germinate within the industry, particularly following recent court victories by Ripple and Grayscale against the SEC. A pivotal turning point came on July 14, 2023, when U.S. District Judge Analisa Torres ruled in favour of Ripple, asserting that the sale of XRP tokens did not constitute securities.
The outcome of these high-profile cryptocurrency cases carries significant implications, given the parallels with the LBRY and XRP lawsuits, both facing SEC allegations of illicit sales – $1.3 billion in XRP tokens in Ripple’s case. Cryptocurrency stakeholders keen on discrediting the SEC’s decision submitted an appeal which includes a strong statement of disapproval from Kaufman, regarding the unfairness of the SEC’s decisions and their deleterious impact on the cryptocurrency industry more broadly.
Known his formidable advocacy for cryptocurrency investors, Deaton’s commitment to legal battles involving cryptocurrency regulations and legal actions mirrors that of Crypto Law’s founder Naomi Brockwell. Their combined efforts further bolster their mutual aim of providing a comprehensive platform for updating on legal and regulatory aspects of cryptocurrencies in the United States, now more than ever a critical concern for those invested in the industry.
Source: Cryptonews
