The SEC has rejected Hex founder Richard Heart's attempt to dismiss the lawsuit. Heart is accused of misusing $8.9 million in investor funds for luxury purchases and manipulating the Hex staking product.
SEC Jurisdiction in Richard Heart's Case
In an updated court filing, the SEC claimed it has jurisdiction to pursue the case against Hex founder Richard Heart. It asked the U.S. District Court for the Eastern District of New York to deny Heart's motion to dismiss. Filed in 2023, the lawsuit alleges that Heart conducted over $1 billion in unregistered securities offerings and used about $8.9 million of these funds for lavish purchases such as Ferraris, designer clothes, and a $4.3 million black diamond called Enigma.
Richard Heart's Defense Stance
Heart's legal team has rejected the SEC's claims, arguing that Hex, PulseChain, and Pulse X are decentralized blockchain technologies like Bitcoin and should be treated as such. They noted that the SEC does not treat Bitcoin as a security. Additionally, they asserted that Heart, who resides overseas, never promised to return investors' funds.
Parallel Legal Proceedings
In related developments, the Ninth Circuit Court of Appeals has partially overturned the dismissal of a class action against Binance.US over the alleged manipulation of HEX cryptocurrency prices. Heart's case is set for a hearing on October 24, and the outcome remains to be seen as these legal battles unfold.
Richard Heart's case is scheduled for a hearing on October 24. The proceedings are expected to have a significant impact on further legal disputes within the crypto industry.
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