The ongoing legal battle between Coinbase and the U.S. Securities and Exchange Commission (SEC) is heating up as the regulator pushes back at giving the crypto exchange access to the personal emails of SEC Chair Gary Gensler.
Coinbase argues that Gensler’s emails could contain pivotal information related to the SEC’s stance on crypto regulations, which the company believes is essential for its defense in an upcoming trial.
The request by Coinbase is part of its broader strategy to gather evidence for a fair notice trial, which centres on whether the SEC provided adequate notice of regulatory expectations for cryptocurrencies.
The SEC has responded with a filing to a U.S. District Court for the Southern District of New York, pushing back against the request.
In a letter dated July 3, Coinbase’s legal team urged U.S. District Judge Katherine Failla to grant them access to Gensler’s emails.
The team stressed that these communications might reveal Gensler’s personal views and interpretations of crypto regulations. This could be critical in proving that Coinbase lacked fair notice of the SEC’s regulatory expectations.
Coinbase’s attorneys emphasized that Gensler’s public statements and speeches, both in his official and personal capacities, could show inconsistencies or lack of clarity in the SEC’s approach to crypto.
SEC Firmly Opposes Request
In a filing to the U.S. District Court for the Southern District of New York, the SEC described Coinbase’s demand as a misinterpretation of the disclaimer commonly used in Gensler’s public speeches.
SEC argues in the filing that the Coinbase seeks “irrelevant material.” The disclaimer states that the views expressed are personal and not representative of the Commission’s official stance. The SEC argues that this does not imply Gensler was speaking in a purely private capacity nor does it justify the “intrusive” access Coinbase seeks to his personal communications.
The SEC emphasized that public speeches, even when delivered in a non-official setting, are still related to Gensler’s role as the Chair of the SEC and not merely personal opinions.
In the filing, the SEC went on to add that Coinbase’s rationale for examining Gensler’s personal emails lacks relevance and is unlikely to yield information pertinent to their defense. They assert that any insights Gensler might have shared informally, such as at social events or academic settings, would not substantiate Coinbase’s claims of inadequate regulatory notice.
Tit for Tat? Timeline of Filings Between Coinbase vs SEC
The SEC filed charges against Coinbase in June 2023, alleging that the company operated as an unregistered securities exchange, broker, and clearing agency. Coinbase has been vigorously contesting this allegation.
In March, Coinbase sued the SEC for crypto rule-making refusal, alleging that the regulatory body had hindered the industry’s development and clarity.
In April, Coinbase submitted document production requests to the SEC, followed by requests in June to SEC Chair Gensler for documents related to communications deemed pertinent to the case. This includes records that cover the period before Gensler assumed office on April 17, 2021.
In July, Coinbase’s legal team urges U.S. District Judge Katherine Failla to grant them access to Gensler’s emails. They argue that the communications might reveal Gensler’s personal views of crypto regulations.
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