Judge Orders Coinbase and SEC to Argue Over Disclosing Gary Gensler's Private Crypto Communications

Judge Katherine Polk Failla of the U.S. District Court has set the stage for a legal battle between the U.S. Securities and Exchange Commission (SEC) and Coinbase

A legal battle is brewing between the U.S. Securities and Exchange Commission (SEC) and Coinbase over whether SEC Chair Gary Gensler’s private communications on cryptocurrency matters should be disclosed in the ongoing legal dispute.

During a hearing on Monday, Judge Katherine Polk Failla of the U.S. District Court instructed both parties to submit arguments by Wednesday about whether Gensler’s personal conversations are relevant to the case.

Coinbase's legal team is seeking access to data from Gensler’s personal devices, arguing that the SEC has not provided enough guarantees in terms of his chats with market makers.

“We're unable to get information from the SEC. The time period before, we included because we tried to engage with Mr. Gensler and the SEC, but they've refused to say he didn’t use his personal device to communicate about crypto,” Coinbase lawyers stated during the hearing.

On the other hand, the SEC’s attorneys are trying to block the subpoena for Gensler’s conversations. They argue that Gensler is neither a fact witness nor an expert witness in the Coinbase case, implying his private chats aren’t relevant.

However, Judge Failla expressed doubts about Coinbase’s arguments but agreed to consider them.

“I do not find that argument persuasive. Just keep that in mind,” she noted. Despite her reservations, she instructed both sides to submit letters outlining their positions.

This dispute is part of the wider discovery process in relation to the SEC’s enforcement action against Coinbase, which was filed in June 2023.

The SEC alleges that Coinbase has acted as an unregistered securities broker since 2019, which violates U.S. securities law.

Earlier this month, Coinbase initially requested access to Gensler’s communications from his personal devices, alleging that he expressed views and communicated with market makers personally.

The discovery request seeks email conversations and documents related to Gensler’s crypto opinions dating back to 2017.

Also Read: Ripple & Coinbase Cite Binance Ruling in SEC Disputes

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