Judge Faruqui Unconvinced With Binance And SEC

Magistrate Judge Faruqui is not convinced by recent efforts by the plaintiff U.S. Securities and Exchange Commission (SEC) and defendants Binance Holdings, Binance.US, and CEO Changpeng “CZ” Zhao to resolve disputes. The Joint Status Report submitted by both parties indicates a lack of interest to work on mitigating disputes related to document discovery and depositions.

Meanwhile, Paradigm Operations filed an amicus brief supporting Binance’s motion to dismiss the lawsuit by the U.S. SEC as the securities regulator lacks authority on crypto.

Judge Faruqui Gives More Time to Binance and US SEC

According to the latest filings with the court late October 13, Magistrate Judge Zia M. Faruqui gives more time Binance, Binance.US, and CEO Changpeng “CZ” Zhao as well as the U.S. SEC. He asked to cooperate on required document discovery and depositions as per the earlier consent order.

Binance, Binance.US, and CEO CZ, along with the U.S. SEC submitted the joint status report on Wednesday, but Magistrate Judge Faruqui wasn’t convinced with both parties. The plaintiff and defendants have failed to reach any conclusion on discovery requests.

The SEC argues BAM has only produced approximately 382 and refuses to provide its position on producing the remaining documents as requested by the agency under the consent order. Binance.US said the SEC has made more requests since the September 18 hearing, which are unreasonable.

Magistrate Judge Zia M. Faruqui asked both parties to submit a joint status report on October 30. Meanwhile, the SEC, Binance, and CZ will meet and discuss these requests.

Paradigm Files Amicus Brief

Paradigm has once again come in support of Binance to dismiss the SEC lawsuit. Paradigm earlier pointed out faults with the SEC’s Howey Test related to investment contracts and the word “scheme.” Moreover, it argues that the SEC’s definition of “investment contract” would apply the Securities Laws to ordinary asset sales.

The Congress must provide a crypto regulatory framework to prevent the SEC from forcibly gaining authority to regulate crypto assets. Paradigm also urges the court to grant the motion to dismiss the lawsuit.

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