DEBT Box urges judge to toss suit as SEC got case ‘badly wrong’
DEBT Box and other defendants in a Securities and Exchange Commission lawsuit want the case tossed after the court found the agency lied to secure a temporary restraining order against them.
“The SEC got this case wrong. Badly wrong,” lawyers for Digital Licensing Inc., which does business as DEBT Box, told Utah federal court Judge Robert Shelby in a Dec. 4 motion to dismiss. “The SEC should not be allowed to continue to spin a false narrative to avoid dismissal.”
The SEC won a temporary restraining order to freeze DEBT Box assets on Aug. 3, claiming the firm would remove evidence and secretly transfer assets overseas if they were notified the order would be imposed on them.
The agency accused the firm of perpetrating a $50 million fraudulent crypto scheme. DEBT Box sold software mining licenses tied to real-world assets which the SEC claimed were unregistered securities.the defendants refute this claim.
“Not only are such allegations false, but they also fail to meet the basic pleading standards,” it wrote in its latest motion.
A Utah federal court reversed the asset freeze on Nov. 30 saying the SEC misrepresented evidence by claiming DEBT Box closed bank accounts and intended to move to the United Arab Emirates and escape the SEC’s jurisdiction.
The court found the firm didn’t close the bank accounts, and a $720,000 transfer the SEC alleged was sent overseas was actually sent domestically.
The SEC “misrepresents the state of law regarding crypto assets” in its “fatally flawed pleading,” DEBT Box said.
The SEC’s misrepresentation resulted in the issuance of a “show cause order” by Judge Shelby, mandating the regulator to provide reasons why they should not incur penalties for its actions.
SEC’s ‘shocking’ behavior deserves punishment, says Ripple executives
Ripple’s chief technology officer, David Schwartz, said the SEC’s behavior is “shocking.”
“The SEC went to a judge seeking an emergency order to paralyze several businesses and blatantly misrepresented facts to get it before anyone on the other side could defend themselves,” he said in a Dec. 5 X (Twitter) post.
Related: ‘We had to change strategies,’ says SEC enforcement director on recent actions: Report
Pro-Ripple lawyer John Deaton hopes the regulator will be forced to pay up for the damage done to DEBT Box.
The Debt Box case is a great example of why Judge Netburn felt COMPELLED to announce to the world that lawyers at the SEC “lack a faithful allegiance to the law” and do or say anything to advance its own agenda.
In Debt Box the SEC successfully obtained a temporary restraining… https://t.co/Qr2jrOyb1J
— John E Deaton (@JohnEDeaton1) December 5, 2023
DEBT Box’s four principals — Jason Anderson, his brother Jacob Anderson, Schad Brannon and Roydon Nelson — and 13 other individuals were included in the SEC’s action.
Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?
Politics
‘Shy’ Reform voters in Labour areas led to Farage’s party winning by-election, Harriet Harman says
“Shy” Reform voters in Labour areas led to Nigel Farage’s party winning the Runcorn by-election by just six votes, Labour peer Harriet Harman said.
The Runcorn and Helsby seat, created in 2024, went to Reform UK’s Sarah Pochin who defeated Labour candidate Karen Shore by six votes.
Reform overturned a 34.8% majority gained by former Labour MP Mike Amesbury last year before he stood down earlier this year after he punched a constituent on a night out.
It is the closest by-election result since records began in 1945.
Read more: Badenoch apologises to Tory councillors
Labour peer and former minister Baroness Harman told Beth Rigby on the Electoral Dysfunction podcast: “If we’d have known it was so close, I, myself, would have gone on extra time there and got those six votes.
“So, there’s a real level of frustration and I’m sure there’ll be a post-mortem, but I think there’s a lot of talk about shy Reform voters in Labour areas.”
In the local elections, running at the same time, the Conservatives lost control of all 18 councils it was contesting, with Reform taking eight of those.
The party also won two of the six mayoral contests – Reform’s first two mayors.
Harriet Harman on the Electoral Dysfunction podcast
Baroness Harman said Labour now has “got to get on with delivering on the health service” and pointed out the minimum wage increase and breakfast clubs are only just being rolled out.
But she said the government also needs “more of a story” instead of just telling people to “bear with us” while it fixes what the Conservatives did.
“It seems to be that Farage has got no delivery, as yet, and all the story, whereas the government is really getting on with delivery, but it hasn’t got a big enough story about what that fits,” she said.
Read more: Reform’s political earthquake is now shaking our political system
An installation represents a bus stop during Reform UK’s local elections campaign launch in Birmingham. Pic: Reuters
She added that “Blue Labour” MPs – a socially Conservative wing of the Labour Party – “will be emboldened to press for further action” on issues like immigration, which they want to see a tougher stance on.
“There’s been grumbling about the big salience of the concerns of the winter fuel payment, but I don’t see there being any change on that,” she said.
Baroness Harman said she does not think the by-election and local election results were “utterly predictable” and will not lead to any splits or instability within the party.
Kemi Badenoch has apologised to Tory councillors who lost their seats after Reform made massive gains at the Conservatives’ expense in Thursday’s local elections.
The Conservative leader said she knew it was “disappointing” and that she was “sincerely sorry”, but added: “We are going to win those seats back – that is my job now.”
The Tories lost overall control of all 18 councils they had been in charge of that were up for election. There were 23 councils in the race in total.
Politics latest: Sky News analysis shows Reform surge in estimated national vote
A particularly bad loss was Buckinghamshire, which has been under Tory control since 1973 when local government was reorganised. The Conservatives lost overall control by just one seat after losing 29 seats.
Reform, which has never run in local elections before, gained eight councils from the Tories, one that had no overall control previously and one from Labour – the only Labour council up for grabs in this election.
Nigel Farage with the new Runcorn and Helsby MP Sarah Pochin. Pic: Reuters
The Lib Dems won Shropshire from the Tories, as well as Cambridgeshire and Oxfordshire – both of which had no overall control before.
The Conservatives had one win, with Paul Bristow being voted in as Cambridgeshire and Peterborough mayor, previously held by Labour.
Reform’s first major win of the election was the Runcorn and Helsby by-election where Labour lost to Reform by six votes. It was triggered by ex-Labour MP Mike Amesbury resigning after his conviction for punching a constituent.
Sir Keir Starmer said he “gets” why his party suffered defeat there and the results show “we must deliver that change ever more quickly, we must go even further”.
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Tories suffer heavy defeats
Addressing the Conservatives’ abysmal results, Ms Badenoch said: “Other parties may be winning now, but we are going to show that we can deliver and that we are on course and recovering.
“But they [the public] are still not yet ready to trust us,” she added.
“We have a big job to do to rebuild trust with the public.
“That’s the job that the Conservative Party has given me, and I’m going to make sure that we get ourselves back to the place where we are seen as being a credible alternative to Labour.”
Read more:
Reform’s political earthquake is now shaking our political system
Reform wins two new mayoral contests
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Farage: ‘This is Reform-quake’
Ms Badenoch said Labour’s election results showed Sir Keir Starmer “is on course to be a one-term prime minister”.
However, when asked if she would still be leader at the next general election, Ms Badenoch dodged the question and said: “I’m not playing all these questions that the media loves to ask about my future.
“This is not about me.”
She insisted she was the right person to lead the Conservatives, as she was chosen by the party’s members.
“I told them it wouldn’t be easy, I told them it would require a renewal and rebuilding of our party,” she said.
“That doesn’t happen in six months. I’m trying to do something that no one has ever done before, which is take their party from such a historic defeat back into government in one term.”
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