- Debt Box defendants accuse the SEC of concealing the truth to their detriment.
- The defendants now call for sanctions against the regulatory body.
- They claim the gravity of the situation cannot be remedied merely through apologies.
The DEBT Box Defendants have filed a reply brief in the standing lawsuit with the U.S. Securities and Exchange Commission (SEC), asking the court to punish the regulator for its deliberate misdeeds. David Schwartz, Ripple’s chief technology officer, called attention to this development in a recent statement on X, sparking the reaction of other prominent figures.
In their statement, the DEBT Box Defendants accuse the SEC of knowingly suppressing a false statement for months, causing extensive damage to defendants, third-party businesses, token holders, and others globally.
According to the defendants, the SEC has admitted its lead trial counsel made a materially false and misleading statement while filing charges against them. The defendants argue that the SEC failed to correct this false statement for months despite knowing its inaccuracies. Furthermore, they claim that the SEC intentionally concealed and suppressed the truth during legal proceedings, causing unjustifiable harm to the defendants.
In its defense, the SEC contends that its misleading statements were based on inferences drawn from circumstantial evidence, denying any intent to mislead or bad faith. However, the defendants assert that the SEC fails to justify why it knowingly withheld correction for over two months, violating its duty of candor to the Court.
As a result, the DEBT Box Defendants, who initially gave the SEC the benefit of the doubt, now call for sanctions against the regulatory body. They argue that this case warrants sanctions under the U.S. Federal Rules of Civil Procedure. Also, they claim the substantial collateral damage suffered by the investing public cannot be remedied merely through apologies.
Moreover, the DEBT Box defendants contend that if they were the ones engaged in such deceptive practices, the SEC would unlikely find apologies. Therefore, the DEBT Box Defendants respectfully seek an order to dismiss this case with prejudice against both the DEBT Box Defendants and Relief Defendants.
Furthermore, they urge the Court to direct the SEC to bear the attorney’s fees and costs incurred by the DEBT Box defendants during the defense proceedings.
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