Kik Interactivehas hit relieve on the Securities and Alternate Rate lawsuit that claims a $100 million token sale became as soon as unlawful. The firm, which owns Kik Messenger,filed a 130-net page response right this momentin U.S. District Court docket for the Southern District of Original York, alleging that the SEC is “twisting” the info about its token, called Family members, and soliciting for an early trial date and dismissal of the grievance.
Certainly one of the principal key disorders within the case is that ifFamily membersbecame as soon as lovely an in-app token extinct to engage video games, digital merchandise and other products and services in Kik Messenger, or if it became as soon as supposed to be an funding opportunity, as the SEC alleges.
Kik’s usual counsel Eileen Lyontalked about in a press statementthat “since Family members just isn’t itself a security, the SEC must show camouflage that it became as soon as bought in a means that violates the securities licensed pointers. The SEC had access to over 50,000 paperwork and took testimony from with regards to twenty witnesses sooner than filing its Criticism, but it’s unable to originate the case that Kik’s token sale violated the securities licensed pointers without bending the info to distort the file.”
The SEC alleges that thetokensale, launched in 2017, got here at a time when the firm had predicted that it would jog out of money after Kik Messenger had been shedding money for years, and that it then extinct proceeds from that sale to produce a net market for the app.
In the filing, Kik’s simply personnel denied that price, claiming that the SEC’s allegations about its monetary condition “is fully designed for misdirection, thereby prejudicing Kik and portraying it in a antagonistic light” and that Kik began engaged on a cryptocurrency-based completely mannequin after exploring monetization alternatives that may per chance perchance presumably well support it compete against higher techc companies.
They added that “Kik’s Board and Executive Personnel alike believed that Family members became as soon as a courageous belief that may per chance perchance presumably well also clear up the monetization challenges faced by all developers (not lovely Kik) within the present selling-based completely economy, by altering the manner of us steal and promote digital merchandise and products and services.”
The SEC furthermore alleges that the sale of digital tokens to U.S. traders became as soon as unlawful on legend of Kik didn’t register their offer as required by United States law, though it claims that Kik marketed Family members as an funding opportunity whose price would lengthen. In its response, Kik denied that it supplied or bought securities, or violated federal securities licensed pointers.
In the firm’s press statement, Kik CEO Ted Livingston talked about “The SEC tries to paint a image that the Family members mission became as soon as an act of desperation slightly than the courageous walk that it became as soon as to lift the sport, and one that Kakao, Line, Telegram and Fb contain all now adopted.”