The US Securities and Exchange Commission (SEC) has taken a strong stance against Coinbase’s request for additional discovery in their legal dispute. The SEC argues that the vast amount of information sought by Coinbase is largely irrelevant and burdensome. The SEC asserts that the documents requested by Coinbase do not directly relate to the core issues of the case. Instead, they argue that the court’s analysis of the facts and the law will ultimately determine the outcome of the case.
The SEC highlighted the significant burden involved in reviewing and producing the requested documents. They revealed that they have already spent over 400 hours reviewing documents and preparing a detailed privilege log spanning 648 pages. The SEC contends that expanding the search to include millions more documents would be overwhelmingly burdensome. This raises questions about the practicality of fulfilling Coinbase’s demands.
In response to Coinbase’s fair notice defense, the SEC argued that the law’s application to digital assets is clear and that internal SEC communications are irrelevant to this legal standard. Additionally, Coinbase’s request for a sample of SEC Chair Gary Gensler’s emails was met with opposition. The SEC deemed this request burdensome and disingenuous, especially considering Gensler’s testimony that he does not use personal devices for SEC business.
The SEC emphasized the importance of the Court in determining the relevance and proportionality of discovery requests. They stated that proper discovery should focus on what the defendant did and that the scope of discovery should be tailored to the specific facts and legal questions at hand. It is clear that the SEC is pushing back against Coinbase’s broad requests for information, seeking a more targeted approach to discovery.
As the legal battle between the SEC and Coinbase unfolds, the Court’s decision on this discovery dispute will be pivotal in shaping the proceedings. The SEC maintains that they have fulfilled their discovery obligations and urges the denial of Coinbase’s motion, labeling it as unjustified and burdensome. With both sides gearing up for further legal battles, the outcome of this dispute will not only impact the immediate case but could also set important precedents for the future regulation of digital assets in the US.