The judge dismissed the debt fund case, ordering the SEC to pay $1.8 million in fees
A federal judge has ordered the US Securities and Exchange Commission (SEC) to pay $1.8 million in attorneys' fees and receivership fees related to the regulator's civil suit over digital licensing.
On May 28 in the U.S. District Court for the District of Utah, Judge Robert Shelby signed an order requiring the SEC to pay approximately $1 million in attorneys' fees and costs and $750,000 in receivership fees and costs. The order came on a day when one dismissed the case without prejudice.
The judge cited a March ruling in which the court found that the SEC “engaged in bad faith conduct” in a restraining order issued to freeze the assets of the Interim Debt Fund. The company later submitted documents to the court stating that the Commission's information was incorrect, which led to the threat of sanctions.
The sanction against the SEC required the commission to cover “all attorneys' fees and costs arising from a properly filed ex parte relief.” Judge Shelby ruled that all of the defendants' costs in the case were “appropriate” except for one fee of $649.
“This is a big win for us,” Debt Box said in a May 28 X post. “This means that the SEC cannot proceed with the case as it stands.”
Related: US Senators Call SEC Actions in Debt Box ‘Unthinkable'
In July 2023, the SEC filed a lawsuit against Debt Fund, alleging that the firm executed an illegal $50 million crypto scheme. After the company filed documents suggesting the commission made false statements and misrepresentations in order to obtain a temporary restraining order against the company, many are citing it as an example of regulatory violations in the crypto space.
The commission has ongoing charges against several crypto firms, including Binance, Kraken, Ripple and Coinbase. Many lawmakers in the US Congress have been pushing for regulatory transparency over digital assets by the SEC through legislation such as the Financial Innovation and Technology in the 21st Century Act.
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