Judge orders US SEC to pay $1.8M in debt settlement case
A judge dismissed the US SEC's debt-box lawsuit, ordering the SEC to pay $1.8 million in restitution. The rule refers to the SEC's bad faith actions in obtaining an asset freeze order. Debt Fund calls the court's decision a major victory in an over-control situation.
In a legal victory for digital licensing known as DebtBox, a federal judge has dismissed a US Securities and Exchange Commission (SEC) civil suit and ordered the regulator to pay nearly $1.8 million.
The May 28 decision by U.S. District Court for the District of Utah, Judge Robert Shelby, marks a significant rebuke to the SEC's actions in this case.
US SEC at the receiving end
The payments include approximately $1 million in attorney fees and costs and an additional $750,000 in receivership fees and costs.
This order asserts that the SEC engaged in “bad faith conduct” in a March court ruling seeking a temporary restraining order to freeze the assets of the debt fund based on inaccurate information. This misbehavior threatened the court with fines against the commission.
Judge Shelby's ruling ordered the SEC to cover all attorneys' fees and costs resulting from wrongful ex parte relief, except for a $649 fee that it deemed improper.
In a statement released via X, Debtbox hailed the decision as a major victory, saying, “This is a huge win for us. It means the SEC cannot proceed with the case as it stands.
What was the debt box case about?
The SEC indictment, filed in early July 2023, accused DebtBox of orchestrating an illegal $50 million cryptocurrency scheme.
However, Debt Box filed an improper restraining order against the SEC for filings suggesting it made false statements and misrepresentations.
This case has attracted a lot of attention in the cryptocurrency community, highlighting regulatory oversight issues.
Meanwhile, the SEC continues to pursue legal action against several other crypto firms, including Binance, Kraken, Ripple, and Coinbase.
In response, lawmakers have advocated for clearer regulatory frameworks for digital assets, such as the Financial Innovation and Technology for the 21st Century Act, which aims to address these concerns.
