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Prominent legal minds have thrown their weight behind crypto exchange Coinbase in its litigation against the United States Securities and Exchange Commission (SEC). Six distinguished scholars in the domain of securities law provided their insights through an amicus brief. Such documents serve to offer additional arguments for one side in a lawsuit, highlighting the broader consequences a case might have.
These academics chose to voice their support in the U.S. District Court for the Southern District of New York on August 11. Notably, Senator Cynthia Lummis too shared her perspective, aligning with Coinbase, by submitting her own amicus brief the same day.
The experts contributing to this significant move include Stephen Bainbridge from the University of California, Los Angeles; Tamar Frankel from Boston University School of Law; Sean Griffith hailing from Fordham University School of Law; Lawrence Hamermesh from Widener University, Delaware Law School; Matthew Henderson representing the University of Chicago Law School; and lastly, Jonathan Macey of Yale Law School.
Their collective argument leaned on the significance of federal precedents and the well-known Howey test. Their stance was clear - investment contracts must encompass the anticipation of business-related income, profits, or assets. They urged the court to steadfastly uphold the already acknowledged legal description of “investment contract.” They elaborated that a person who wants to become an investor will need to expect a "continued contractual claim" on a business' income and assets.
Lastly, the scholars took a moment to emphasize that their current or past ties with esteemed universities or law institutions do not play a role in their decision to support the brief. Their stance is purely based on their expertise and understanding of the legal matter.
