Pro-XRP lawyers react as LBRY files a new motion in its case against the SEC.
Top cryptocurrency lawyers have been reacting to LBRY’s latest motion filed in its ongoing lawsuit against the SEC. Earlier today, LBRY, a content-sharing and publishing platform, filed it’s supplemental brief supporting its motion to limit the Securities and Exchange Commission’s remedies in the SEC vs. LBRY case.
As part of its claims, LBRY asserted that it had been focused on getting clarity around using LBRY Tokens (LBC) from the SEC for years. However, the commission refused to clarify the token while seeking a broad-based injunction that is neither specific nor clear.
Although a summary judgment decision was made in favor of the Securities and Exchange Commission last year, LBRY asks the court, in its latest motion, to clarify that LBC secondary market transactions are not securities.
Hogan Says SEC’s Vague Injunction Is a Possible Scenario in Ripple Case
Commenting on the development, pro-XRP lawyer Jeremy Hogan called on XRP community members to closely follow the ruling, as the vague injunction the SEC seeks in the LBRY case is also a possible scenario in the ongoing Ripple lawsuit.
“Watch out for this ruling! as this is a possible scenario in the Ripple case with the SEC asking for a broad/vague injunction and Ripple seeking clarity from the Judge,” said attorney Hogan.
It bears mentioning that many crypto enthusiasts consider the SEC’s claims to be broad, which could allow the commission to classify crypto secondary market transactions as securities.
In the Ripple lawsuit, attorney John E. Deaton filed an amicus brief on behalf of thousands of XRP investors, proving that secondary market sales of XRP are not securities.
Attorney Deaton, who represented tech journalist Naomi Brockwell as amicus curiae counsel in the SEC vs. LBRY case, noted that he objected to the SEC’s “overbroad language,” which aims to classify LBC secondary market transactions as securities.
He disclosed that he has the transcript from the January 30 hearing, where the Judge promised to clarify that his order does not apply to secondary market sales. Deaton promised to share the transcript of the LBRY hearing in the coming weeks.
I have to wait another few weeks before I can publish the hearing transcript. But I’m hoping the Judge does what he said he would do and not do what he said he would not. https://t.co/6KSbEJxrvU
— John E Deaton (@JohnEDeaton1) May 27, 2023
Attorney Morgan Reacts to LBRY’s Motion
In a similar development, pro-XRP lawyer Bill Morgan also commented on LBRY’s latest motion. Attorney Morgan noted that LBRY is raising the major questions at the late stage of the lawsuit.
Per Morgan, LBRY arguing that the SEC has no authority to shoehorn the Howey test onto digital assets, including LBC, is a good appeal point argument.
LBRY stated in the motion that the SEC has “specific authority to regulate and enforce the federal securities laws.”
Reacting to the remark, attorney Morgan said it would not bode well for Ripple and Coinbase in their legal battles against the SEC if the Judge decides that the commission has congressional authority to regulate digital assets.
Meanwhile, the pro-XRP lawyer asked who is behind the funding of LBRY’s legal battle, given that the company claimed the SEC drove it into insolvency.
Telling the court in effect it shouldn’t impose relief. If the judge decides the SEC has congressional authority to regulate digital assets it will not be helpful to Ripple and Coinbase even though it wouldn’t be a binding a decision. Whose funding the appeal. LBRY is insolvent/2
— bill morgan (@Belisarius2020) May 26, 2023