The ongoing legal battle between the U.S. Securities and Exchange Commission (SEC) and cryptocurrency exchange Coinbase (COIN) has taken an unexpected turn.
A court order on Thursday revealed that the SEC will present its response to Coinbase’s first legal defense much earlier than anticipated, with the hearing scheduled for July 13.
This development comes as a result of Coinbase’s “creative” defense strategy, which involved filing its response 40 days before the August 7 deadline.
As per the rules, the SEC was required to file a response to Coinbase’s defense by July 3. However, the SEC requested a three-day extension due to the July 4 holiday weekend, and the court granted it.
The court also converted the pre-trial conference to a pre-motion conference and rescheduled it from August 24 to July 13 at 14:00 UTC. In a pre-motion conference, the prosecutor or defense attorney asks the court to decide on a specific issue before the trial.
In response to the SEC’s complaint, Coinbase has raised various defenses, including the claim that the tokens mentioned in the case are beyond the Commission’s authority.
Coinbase’s counsel stated in a recent letter to the court that the SEC’s action violated due process and constituted an abuse of discretion. The exchange argues that the subject matter of the case falls outside the SEC’s regulatory purview.
Experts have noted that Coinbase’s tactic of advancing the case via a motion for judgment on the pleadings by filing its response early is not uncommon but rather a “creative strategy.” The exchange aims to present documents beneficial to its cause directly to the judge through its early response.
Explaining the difference between a motion to dismiss and a motion for judgment on the pleadings, legal commentator MetaLawMan said that the latter allows the judge to consider other pleadings filed in the case, including the defendant’s answer to the complaint.