On September 7, LBRY filed an appeal with the U.S. Court of Appeals for the First Circuit, dissenting from the July 11 decision. In July, the court ordered LBRY to pay an administrative fine and also stop making unregistered securities offerings.
In March 2021, the US Securities and Exchange Commission (SEC) sued LBRY, Inc., alleging that its LBRY Credit (LBC) token was being traded in violation of the Securities Act of 1933. In November 2022, the US District Court for the District of New Hampshire recognized LBC tokens as securities. The court granted the SEC’s motion for a summary judgment against LBRY, barring the platform from offering “unregistered securities” and ordering the company to pay a $111,614 fine to the regulator.
Initially, the amount required by the regulator was $22 million. However, the fine had to be reduced due to lack of funds from LBRY. Earlier, LBRY founder and CEO Jeremy Kauffman said that “LBRY as a company is almost dead” and, in accordance with a court order, it will take several months for it to go into liquidation.
However, LBRY’s willingness to challenge the court’s decision could make a difference. The appeal was filed amid high-profile legal victories by cryptocurrency companies over the US regulator. Thus, Ripple was able to obtain a court recognition that XRP is not considered a security in secondary sales, and asset management company Grayscale managed to convince the court that the SEC’s refusal to launch a spot ETF for bitcoin has no good reason.
Source: Bits
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