United

Crowd Machine

Northern

In a recent court ruling, Crowd Machine and Metavine, the issuers of Crowd Machine Compute Tokens (CMCT), have been ordered to pay more than $20 million in disgorgement, interest, and penalties. The case, which began over two years ago, has also found the company’s founder, Craig Sproule, liable for his involvement.
<h2 class="wp-block-heading" id="background-of-the-case">Background of the case</h2>
The legal saga commenced in January 2022 when the United States Securities and Exchange Commission (<a href="https://www.cryptopolitan.com/sec-reveal-sim-swap-on-hacked-x-account/" rel="noopener noreferrer nofollow">SEC</a>) filed a lawsuit against Craig Sproule, alleging that the 2018 initial coin offering (ICO) for CMCT constituted a “fraudulent and unregistered” securities sale. The SEC’s complaint also included accusations of Sproule’s misuse and loss of $5.8 million out of the $33 million raised during the ICO.
CMCT was originally designed with the intention of reimbursing computer owners for utilizing their computing power and compensating programmers for their code-writing efforts. However, the tokens never became operational.&nbsp;
As a result of the SEC’s action, Sproule was fined $195,047 and directed to cease the operation of CMCT, along with removing it from the single cryptocurrency exchange on which it had been listed. Notably, the defendants did not admit to or deny any wrongdoing.
On January 17, the District Court of Northern California issued an amended final judgment, compelling the defendants to disgorge $19,676,401.27 and $3.4 million in prejudgment interest. Furthermore, Metavine, one of the involved companies, was held accountable for disgorging $5 million. The court also imposed civil penalties of $600,000 on each defendant.
In response to these developments, the SEC released a statement on January 24, highlighting,
<blockquote class="wp-block-quote">
 “The prior consent judgments fully resolved the SEC’s action against Mr. Sproule, but left the Court to determine the monetary relief to be paid by the remaining defendants.”
</blockquote>
<h2 class="wp-block-heading" id="icos-and-sec-enforcement">ICOs and SEC enforcement</h2>
Initial coin offerings (ICOs) were a common method for launching cryptocurrencies until the SEC declared them securities sales in July 2017. Since that regulatory shift, the SEC has pursued multiple cases against ICO issuers who allegedly violated securities laws.
Craig Sproule, the founder of Metavine in 2013 and Crowd Machine in 2018, has faced significant legal consequences due to the CMCT <a href="https://www.cryptopolitan.com/sec-charges-craig-sproule-with-fraud/" rel="noopener noreferrer nofollow">case</a>. Metavine is described as a “no-code development platform,” while Crowd Machine operates as a “unified cloud platform.”
It is worth noting that Metavine reportedly filed for bankruptcy on January 3, which may have implications for the ongoing legal proceedings.

California court orders Crowd Machine and Metavine to pay over $20M in CMCT case

Table of Contents

Cryptopolitan_News

Alte articole publicate pe 24 ian. 2024

SEC Commissioner Says ETH ETFs May See Approval Without Going to Court

Nine Spot Bitcoin ETFs Acquired Over 100K Bitcoin (BTC) In Just Seven Days After Launch

Litecoin (LTC) Price Faces Make-or-Break Moment at 600-Day Support

Will Solana Price CRASH to $75?

When Will Hedera’s HBAR Token Surpass the $0.272 Mark in 2024?

Crypto Giant Nexo Seeks $3 Billion in Damages from Bulgaria

Join our free newsletter for daily crypto updates!