SEC wins court bid for summary judgment in ICO lawsuit against Kik

U.S. Judge Alvin Hellerstein sided with the U.S. Securities and Exchange Commission on Wednesday, ruling in favor of the agency’s motion for summary judgment in its lawsuit against tech company Kik and the $100 million initial coin offering (ICO) that triggered the long-running legal dispute.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The September 30 opinion by Hellerstein noted that "[t]he U.S. Securities and Exchange Commission ("SEC" or "Plaintiff’) filed this action against Kik Interactive Inc. ("Kik" or "Defendant"), alleging that Kik’s unregistered offering of digital tokens violated Section 5 of the Securities Act. The parties cross-moved for summary judgment," going on to explain:” data-reactid=”13″>The September 30 opinion by Hellerstein noted that “[t]he U.S. Securities and Exchange Commission (“SEC” or “Plaintiff’) filed this action against Kik Interactive Inc. (“Kik” or “Defendant”), alleging that Kik’s unregistered offering of digital tokens violated Section 5 of the Securities Act. The parties cross-moved for summary judgment,” going on to explain:

“As detailed further herein, I hold that undisputed facts show Kik offered and sold securities without a registration statement or exemption from registration, in violation of Section 5. Therefore, the SEC’s motion for summary judgment is granted, and Kik’s motion for summary judgment is denied.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="As previously reported, both sides submitted their arguments to the court for their respective motions for summary judgment in early July during a virtual court hearing. The SEC first filed suit against Kik in July 2019, alleging that Kik "sold the tokens to U.S. investors without registering their offer and sale as required by the U.S. securities laws." In response, Kik vowed to fight back against the SEC’s lawsuit.” data-reactid=”16″>As previously reported, both sides submitted their arguments to the court for their respective motions for summary judgment in early July during a virtual court hearing. The SEC first filed suit against Kik in July 2019, alleging that Kik “sold the tokens to U.S. investors without registering their offer and sale as required by the U.S. securities laws.” In response, Kik vowed to fight back against the SEC’s lawsuit.

According to Hellerstein’s ruling, the next steps call for the two sides to “jointly submit a proposed judgment for injunctive and monetary relief” by October 20.

“If they cannot agree on a proposed judgment, they should note their differences in a single document, supported by separate statements in a single letter, to be submitted by the same date, October 20, 2020,” he wrote.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Hellerstein’s full court order can be found below:” data-reactid=”19″>Hellerstein’s full court order can be found below:

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="gov.uscourts.nysd.516941.88.0_2 by MichaelPatrickMcSweeney on Scribd” data-reactid=”20″>gov.uscourts.nysd.516941.88.0_2 by MichaelPatrickMcSweeney on Scribd

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="©&nbsp;2020&nbsp;The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.” data-reactid=”24″>© 2020 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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