A Texas-based retailer filed a lawsuit against the Security, and To token airdrops, the Exchange Commission needs to get legal protection. Still, the authorities said, the lawsuit was based on a nonexistent policy.
The SEC requested the judge dismiss the case filed by the American company, trying to shield itself from the regulatory inquiries over the past airdrop.
On Wednesday, the SEC filed to toss a March 25 lawsuit from Beba and the DeFi Education Fund. The suit requested that a Waco District Court judge rule that Beba’s self-titled token airdrop was not a security. The SEC argued the case is “premature and premised on a phantom” policy
The Beba‘s lawsuit expected the SEC to rule this token as a security and sue the issuers as it “has adopted a de facto rule, without notice or comment, that the ‘vast majority’ of digital assets ‘are securities’” Chair Gary Gensler. Remarks from 2022.
DEF and BEBA did not clarify “a rule, order or other Commission action that reflects the promulgation of the supposed policy,” the SEC said.
“In effect, plaintiffs ask this Court to adjudicate the legality of a policy that does not exist and to block potential future enforcement action that may never occur.”
The SEC has sued many crypto companies for violations of U.S. securities laws, asserting that multiple cryptocurrencies are unregistered securities.
In their lawsuit, Beba and DEF argued that the SEC is violating the Administrative Procedure Act (APA) because the regulator bypassed the rulemaking process. The SEC said that the unwritten policy and threat of enforcement do not fall under the APA definition.
The regulator asserted it has immunity from lawsuits until it gives up that right through actions like rulemaking. The policy alleged by Beba and DEF isn’t enough to prove the SEC waived its immunity by forming an opinion on crypto.
“The Commission acts through a majority vote of a quorum of its five Commissioners,” the SEC explained. “The statement of a single Commissioner cannot represent the adoption or existence of a Commission policy, and a Comissioner’s speech is not agency action.”
