Judge Ann Marie McIff Allen ruled that there was no substantial basis for Krohn’s appeal against continued litigation with the US Securities and Exchange Commission (SEC).
Last year, the SEC accused Green United of organizing a fraudulent scheme that operated from April 2018 to December 2022. The company sold special equipment Green Boxes and Green Nodes for “environmentally friendly mining of GREEN tokens.” Investors were promised profits that they did not receive because the company defrauded investors, leaving them with worthless assets, the SEC insists.
According to Krohn’s lawyers, the regulator was never able to prove that GREEN tokens belong, in accordance with the Howey test, to the category of securities. This standard is used to determine whether a transaction is considered an investment contract.
In October, Krohn asked the court to overturn the fine and dismiss the SEC’s charges. Green United founder Wright Thurston also filed a motion to dismiss the case.
The judge disagreed with Krohn’s arguments, saying he had misinterpreted the law. The court sided with the SEC, clarifying that the sales of mining devices and tokens constituted investment contracts and were subject to securities laws.
This fall, the SEC won another legal victory over a crypto company – a Massachusetts federal court recognized Rivetz (RvT) tokens, created on the basis of Ethereum, as securities.
Source: Bits
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