- Coinbase is seeking a dismissal in the SEC case.
- A legal expert has shed light on the crypto exchange’s tactics.
- The exchange’s actions have notably sped up the case’s timeline.
Things are heating up in the United States Securities and Exchange Commission’s (SEC) case against Coinbase. On Wednesday, June 28, the crypto exchange responded to the SEC’s complaint revealing its intent to file for a dismissal of the case.
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Following the filing, securities lawyer James “MetaLawMan” Murphy has highlighted that Coinbase is taking a rather unconventional approach to seeking dismissal.
Coinbase Employs Creative Approach
In a lengthy Twitter post on Thursday, June 29, Murphy stressed that the crypto exchange intends to file a “‘motion for judgment on the pleadings” under Rule 12c instead of a typical motion to dismiss under Rule 12b.
As explained by the lawyer, Coinbase’s approach will compel the judge to consider other pleadings in the case, including the crypto exchange’s response to the SEC’s complaint. On the other hand, with a filing under Rule 12b, the judge would have only considered the SEC’s complaint and the attached documents.
"Coinbase appears to be using this creative strategy to get documents helpful to its cause in front of the Judge," Murphy asserted.
Buttressing his view, Murphy highlighted that Coinbase’s response was loaded with more material than one will typically find in reply to a complaint. These include Coinbase’s S-1 registration statement, congressional testimony from SEC Chair Gary Gensler, transcripts from Binance’s temporary restraining order hearing, and the Hinman emails, all of which will be considered if the judge accepts Coinbase’s motion.
The court will hold a pre-motion conference on July 13 to determine the fate of the motion. According to Murphy, however, this is just a formality.
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“Permission is granted unless there is some very good reason offered by the other side,” he argued.
Coinbase notably filed its response 40 days before the court deadline of August 7, significantly speeding up the case’s timeline. Per the previous timeline, the pre-trial conference, which has been converted to a pre-motion conference, would have taken place on August 24.
The SEC is now scheduled to file its response to Coinbase on July 6.
The regulator accuses Coinbase of operating an unregistered securities exchange. The crypto exchange has refuted the SEC’s claims alleging that the regulator does not have jurisdiction over crypto exchanges.
On the Flipside
- The SEC still has an opportunity to oppose Coinbase’s arguments and potentially sway the judge.
- There is no guarantee that Coinbase will succeed in dismissing the case even if its motion is granted.
Why This Matters
The distinction between Coinbase’s move to dismiss and the typical motion to dismiss gives greater insight into the crypto exchange’s strategy, with its actions suggesting that they believe there is a chance of tossing the case quickly.
Take a deep dive into Coinbase’s arguments against the SEC’s complaint:
Coinbase Hunts Dismissal of “Neither Prudent nor Lawful” SEC Lawsuit
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