US Judge Dismisses Debt Box Case and Orders SEC to Pay $1.7M

A United States Judge has ordered the Securities and Exchange Commission (SEC) to pay Debt Box roughly $1.8 million in fees and legal expenses after dismissing the agency’s case against the cryptocurrency firm.

Debt Box’s native token, DEBT, reacted to the news and rallied 12% from $11.23 to $12.58. However, at the time of writing, the crypto token had retraced and was trading at $11.69, registering a 4% surge in the past 24 hours.

Judge Dismisses SEC Case Against Debt Box

According to a filing at the United States District Court for the District of Utah, Judge Robert Shelby granted the SEC’s motion to dismiss the case against Debt Box without prejudice. The SEC claimed dismissing the case without prejudice would protect investors and the public interest.

In addition, the securities agency sought to dismiss the case to allow a new team of lawyers to analyze existing evidence and take additional steps to ensure accuracy. The Commission intends to engage with Debt Box to determine whether a new lawsuit is necessary and, if so, the scope of the complaint.

The SEC sued Debt Box in July 2023, alleging that the company defrauded investors by selling unregistered securities and perpetrating a $50 million crypto scheme. The agency claimed that Debt Box had made false statements and was closing its bank accounts in an attempt to leave the United States, requesting an ex parte temporary restraining order against the firm.

Although Judge Shelby initially granted the SEC’s request, he later questioned the accuracy of the agency’s information and demanded evidence. The SEC eventually admitted its errors, and apologized for the oversight, claiming that the information it received was inaccurate.

SEC to Pay $1.75M in Fees

Nevertheless, Judge Shelby sanctioned the SEC two months ago and ruled that it had committed a gross abuse of power in its actions against Debt Box.

Having dismissed the lawsuit, the SEC must now pay all attorney fees and costs Debt Box spent in the case, totaling $1.75 million. 

Reacting to the judge’s ruling, Debt Box said: “Today’s decision is a monumental victory, not just for D.E.B.T. Box but for the entire industry and our dedicated community. It underscores the importance of integrity and fairness in regulatory practices.”