U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25775 / July 12, 2023
Securities and Exchange Commission v. LBRY, Inc., Case No, 21-cv-260-PB (D.N.H. filed March 29, 2021)
New Hampshire Issuer of Crypto Asset Securities That Violated Registration Requirements Enjoined and Ordered to Pay Penalty
On July 11, 2023, Judge Peter Barbadoro of the United States District Court for the District of New Hampshire ordered LBRY, Inc., a New Hampshire software company that issued crypto asset securities called “LBRY Credits” or “LBC,” to pay a civil penalty of $111,614. The Court also permanently enjoined LBRY from further violations of the registration provisions of the federal securities laws and from participating in unregistered offerings of crypto asset securities in the future.
The SEC’s complaint alleged that, from at least July 2016 to February 2021, LBRY, which provides a video sharing application, sold crypto asset securities called “LBRY Credits” to numerous investors, including investors based in the United States. LBRY’s failure to file a registration statement denied prospective investors the information required for such an offering to the public. In November 2022, the Court granted summary judgment in favor of the SEC, holding that LBRY offered and sold LBC in violation of Section 5 of the Securities Act of 1933, the registration provisions of the federal securities laws. The Court rejected LBRY’s claim that it lacked fair notice of the application of those laws to its offer and sale.
The SEC is represented by Marc Jones, Peter Bryan Moores, and Amy Burkart of the Boston Regional Office.