Hodl Law Challenges SEC: Court Sets Date for Ethereum Oral Arguments
Hodl Law, PLLC, a law firm that utilizes cryptocurrency, has initiated an appeal, with the 9th Circuit Court of Appeals setting the date...
Hodl Law, PLLC, a law firm that utilizes cryptocurrency, has initiated an appeal, with the 9th Circuit Court of Appeals setting the date for oral arguments on July 18, 2024.
The firm is contesting the dismissal of its case against the United States Securities and Exchange Commission (SEC), which aims to clarify the regulatory status of Ethereum and its cryptocurrency, Ether.
The upcoming hearing will scrutinize the SEC’s approach to see if it aligns with the provisions of the Securities Act of 1933.
Hodl Law’s Challenge to SEC Dismissed Over Lack of Direct Conflict
Hodl Law, a legal firm, brought a lawsuit against the SEC in a California federal court, arguing that the SEC’s unclear policies and enforcement actions against cryptocurrency could harm its operations. The firm specifically sought a court declaration that Ether transactions do not breach securities laws. However, the case was dismissed because Hodl Law couldn’t prove a direct legal conflict with the SEC, as the agency hadn’t made a definitive ruling or taken concrete action against the firm.
- Key Issue: Need for clarity on Ether transactions as securities.
- Court Decision: Dismissal due to no direct conflict or final SEC action.
SEC Defends Dismissal of Hodl Law Suit, Citing Speculative Claims and Lack of Concrete Policy
In its defense, the SEC argued that Hodl Law’s fears of future enforcement were merely speculative and did not meet the legal requirement of concrete harm necessary for standing in court. The agency highlighted that mere potential risks from possible investigations were not grounds for initiating legal action. Additionally, the SEC dismissed claims that its regulatory approach, described by Hodl Law as “regulation by lawsuit,” lacked the concrete basis needed for judicial intervention.
- Key SEC Argument: Hodl Law’s concerns are too speculative to warrant a lawsuit.
- Legal Framework: Absence of a definitive policy or ruling precludes valid legal complaints under the Administrative Procedure Act.
- SEC’s Stance on Ether: Despite previous indications from an SEC official in 2018 that Ether is not considered a security, current SEC Chair Gary Gensler’s remarks suggest otherwise, adding to the confusion and frustration voiced by Hodl Law’s attorney, Frederick Rispoli. This issue underscores ongoing challenges as the SEC steps up enforcement against crypto platforms like Coinbase for alleged securities violations.
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