Ripple’s ally LBRY has obtained court approval for an expedited briefing schedule concerning the remedies sought by the commission. US attorney and former federal prosecutor James K. Filan shared via tweet.
According to the document filed the decentralized content platform said it proposed a settlement with the SEC on Nov. 25.
On Nov. 29, following the submission of the settlement plan, the parties met to negotiate the terms, but they were unable to come to an agreement over the remedies requested by the regulator.
Due to its precarious financial situation, LBRY requested an accelerated briefing timetable which the court has now accepted.
Following its legal defeat by the United States Securities and Exchange Commission [SEC], LBRY declared that its days are probably numbered.
In March 2021, the SEC filed a lawsuit against LBRY Inc. over its LBC tokens, claiming that the firm had been marketing unregistered securities since 2016. On Nov. 7, a judge declared the tokens to be securities, dealing a devastating blow to the industry. The SEC ultimately prevailed in that dispute.
LBRY Inc. on Nov. 30, gave a status update on the company’s situation via Twitter and said that it “will probably be dead in the near future.” The core protocol and blockchain will continue, though:
The SEC claimed that LBC was intended only for speculative purposes in its lawsuit against LBRY, while LBRY countered that the tokens provided important use cases for its platform.
It also argued that some buyers intended to use the token instead of holding it as an investment. Federal Judge Paul Barbadoro rejected this argument.
Ripple Lawyers Are Tracking The Case Closely
“Nothing in the case law suggests that a token with both consumptive and speculative uses cannot be sold as an investment contract…Accordingly, statements from a subset of LBC holders that they purchased LBC for use on the LBRY Blockchain is of limited relevance in determining whether LBRY offered it as a security” the judge stated.
The LBRY saga has been closely followed by crypto lawyers since it could end up being a landmark case. In June, LBRY suggested that the case would affect Ripple and the entire crypto industry.
The SEC’s success is likely to have significant repercussions for the Ripple case as it would likely utilize the decision to support its stance. The agency maintained that the XRP coin was offered for sale by Ripple as an unregistered security.