The SEC has opposed LBRY’s request to restrict the SEC’s remedies, according to James K. Filan’s most recent updates on the Ripple lawsuit and LBRY case. In a flashback to what happened after LBRY’s unsuccessful lawsuit against the SEC, LBRY sent the SEC a settlement offer on November 25 in the wake of a status conference on November 21.
The SEC claims that “a penalty equal to LBRY’s full pecuniary gain of $22,151,971 is fair and reasonable under the circumstances.” The SEC doesn’t want to regulate crypto; it wants to kill it in the United States.
— James K. Filan 🇺🇸🇮🇪 126k (beware of imposters) (@FilanLaw) December 20, 2022
Ripple Ally Raises Objection to $22 Million SEC Fine
Both parties met to discuss the parameters of the settlement plan after it was submitted on Nov. 29. Still, they could not agree on the specifics of the remedies the regulator wanted. LBRY requested an expedited briefing schedule to minimize the SEC remedies, which the court granted.
It did this by citing its financial situation. The extent of the SEC remedies was never made public during this time. According to new records, this is just now becoming apparent.
The SEC asserts that “a penalty equal to LBRY’s full pecuniary gain of $22,151,971 was fair and reasonable under the circumstances” in a document that is an attachment to James K. Filan’s tweet.
The value LBRY earned in return for selling 280 million LBC from its premise and market-making activity on various crypto asset trading platforms, according to the SEC, equaled LBRY’s gross proceeds for their Section 5 violation. This is estimated to be worth over $22 million.
To discourage LBRY and others from making illegal, unregistered offerings, the agency asks the court to impose a fine on LBRY equal to its gross financial gain. It draws attention to a section of the Securities Act that establishes three levels of penalties and adds that a three-step process may also be used to impose a civil monetary penalty.
The statutory penalty amount for a breach by LBRY of each tier in the first step is as follows: for the first tier, $103,591; for the second tier, $517,955; and for the third tier, $1,035,909. This sum has been updated for inflation. The maximum punishment was decided upon in the second step. It states that the gross financial gain for LBRY is roughly $22,151,971. It is shortly expected that LBRY will respond to the SEC motion.
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