A US judge has denied a motion filed by crypto exchange Binance which sought to stop the SEC from making public statements on the SEC/Binance case. The court said it cannot “wordsmith” either party’s press releases.
The motion followed the SEC’s press release on June 21 in which the securities regulator had reiterated its allegations of commingling of user funds by the exchange’s leadership. The agency had filed for a freeze on the exchange’s assets suggesting the need to protect US customers.
In its response to the SEC’s press release, Binance said the regulator had published misleading facts about Binance and CEO Changpeng Zhao mishandling Binance.US customer funds. The motion sought orders against the SEC, specifically that the court order counsel to comply with ethical obligations and not to make “misleading extrajudicial statements that may materially impact court proceedings”.
Judge Amy Berman Jackson on Monday June 26 issued an order denying the motion. Her order read: “While all of the lawyers in this case should adhere to their ethical obligations at all times, it is not apparent that Court intervention to reiterate that point is needed at this time, or that it is necessary or appropriate for the Court to get involved in wordsmithing the parties’ press releases. Nor is it clear that the agency’s public relations efforts to date will materially affect proceedings in this case.”
John Reed Stark, Former Chief, SEC office of Internet Enforcement, commented on the court’s decision, suggesting that Binance’s filing may not have been worth it. James “MetaLawMan” Murphy, a securities lawyer, said the judge’s order isn’t a great one for Binance – even if it doesn’t impact the merits of its case.
The court also set forth a timeline for the early proceedings. Binance will plead its case on September 21, 2023 and the plaintiff will present their legal arguments on November 7, 2023. The court will listen to replies starting December 12.
