November 30, 2023

Telegram: recent court ruling undermines SEC allegations

Telegram refers to a recent decision of an American court, according to which the SEC’s arguments about the company’s violationUS federal securities laws are wrong.

In a letter sent by lawyersTelegram on Friday to Judge P. Kevin Castel of the U.S. District Court for the Southern District of New York, citing the California Court of Appeal's March 3 decision. The trial itself is not related to cryptocurrencies, since it concerns a legal conflict between parties to an agreement to renovate and lease premises in a building in Los Angeles. However, Telegram believes that the California court's opinion reflects the company's position in the case against the SEC.

Lawyers managed to find similar clauses in the wording of the agreement on the purchase of Gram tokens and the partnership agreement, which was considered by a California court.

“As in the case of the plaintiff Siry Investment, the campaign toThe sale of Gram tokens did not involve the distribution of securities to the general public and thereby did not violate US securities laws. Telegram has strived not to engage in transactions that would be subject to securities laws,” — writes the company.

Telegram lawyers are confident that although agreements for the purchase of Gram tokens by accredited investors fall under the definition of securities, as required by the SEC, the tokens themselves are not.

“There were clear provisions in the purchase agreementswhich stated that their execution could not violate the law, and each buyer guaranteed that they would distribute Gram tokens only in accordance with securities laws and the terms of the purchase agreement,” — lawyers say, drawing another parallel with the Siry Investment case.

The SEC in response to this sent a letter on March 9, in which it responded to these arguments of Telegram. The regulator indicated that the company "continues to try to use labels instead of substance."