LBRY Will Appeal ‘Unjust and Incorrect’ SEC Lawsuit Ruling, Says CEO
The company behind LBRY, a blockchain publishing platform, said on Thursday it plans to appeal a court’s decision that found it was liable for violating federal securities laws last year, according to a court filing.
LBRY CEO Jeremy Kaufman told Decrypt the company is ready for round two, and that it’s fighting on behalf of other digital asset firms in the U.S. too.
“LBRY is appealing the SEC’s decision because it is unjust and incorrect,” Kaufman said in a written statement. “The SEC has shown clear intent to use this ruling to damage the cryptocurrency industry more broadly. We won’t let them.”
A New Hampshire court sided with the Securities and Exchange Commission (SEC) last November after the agency accused LBRY, Inc. of selling its LBRY Credits ($LBC) token to investors without registering the asset as a security.
LBRY argued that LBRY Credits were not securities, pointing to the tokens’ utility on LBRY’s platform. However, Judge Paul J. Barbadoro found the company could offer “no reasonable trier of fact that could reject the SEC’s claims.”
Since the SEC’s victory over LBRY, the agency has sustained what some crypto advocates say are several black eyes in court. The watchdog lost to Grayscale last month when a D.C. appellate court found the SEC’s previous denial to convert Grayscale’s Bitcoin Trust into a spot Bitcoin ETF was “capricious.”
The SEC has also lost some ground in its court battle against Ripple Labs over XRP being an unregistered security. In July, a New York judge issued a partial ruling saying the token was not necessarily a security on its face and certain public XRP were not unlawful.
Kaufman declined to comment to Decrypt on whether the firm will tap the decision in Ripple’s lawsuit as part of its appeal process.
Library Credits have risen 35% to $0.0123 over the past week, according to CoinGecko. At the same time, the token has fallen 8.7% over the past day, paring back some gains after it reached its highest price since April of last year.
LBRY has been public about how the lawsuit has impacted its bottom line, and it said it would shut down in July following the court’s final judgment. Recognizing the company’s close-to-defunct status in May, the SEC had moved to lower financial burdens placed on the firm from $44 million to around $111,000.