The U.S. Securities and Exchange Commission (SEC) will deliver its response to Coinbase’s (COIN) first legal defense on July 13, according to a court order Thursday.
The hearing is now much earlier than expected due to a “creative” defense tactic by Coinbase, where the exchange submitted its initial response 40 days ahead of the Aug. 7 deadline.
According to the rules, the SEC had until July 3 to file a response defending Coinbase. The SEC requested a three-business-day extension due to the July 4th holiday weekend, which the court granted.
In addition, the court changed the preliminary hearing to a preliminary hearing and postponed it from August 24 to July 13 at 14:00 UTC The court decides on a specific issue before the hearing.
In response to the SEC’s complaint, Coinbase argued that many of the tokens highlighted in the SEC’s case fall outside the commission’s purview.
“Coinbase has responded to the SEC’s complaint with numerous objections, including alleging that this lawsuit violates due process and constitutes an abuse of discretion. But there’s a more fundamental issue with the SEC’s case — one that the chairman recognized two years ago and that now authorizes Coinbase to rule on the filings: The subject falls outside the jurisdiction of the SEC,” Coinbase’s attorney said recently in a letter to the SEC court.
The exchange’s tactic of advancing the case through a motion for pleadings by filing its response 40 days early is not seen as unusual in cases like this, but is a “creative strategy,” a legal expert said. The exchange’s move aims to “The response will allow you to provide the judge with documents helpful to your cause,” said MetaLawman, an attorney and Twitter legal commentator, in one tweet thread.
“In a motion to dismiss, a judge may consider only the allegations of fact in the complaint and any documents attached to or referred to in the complaint – nothing else,” MetaLawMan said. “By contrast, when requesting a pleading, a judge may consider other pleadings filed in the case, including the respondent’s response to the complaint.”
Coinbase did not immediately respond to CoinDesk’s request for further comment.
During the July 13 court hearing, Judge Katherine Polk Failla will rule on whether Coinbase can proceed with this motion.
“This is usually a formality and permission is granted unless the other side gives a very good reason,” MetaLawMan said.