Oregon AG is trying to block Coinbase bids to move securities cases to federal court

The Oregon Attorney General opposes Crypto Exchange Coinbase’s attempt to move securities violation cases to federal court, showing the latest clashes in state and federal crypto enforcement.

AG Dunleyfield asked a federal judge in a motion filed Tuesday to remand the case to Multnomah County, which was first filed in April.

“This is a typical state law suit that should be ruled by the state court where the Attorney General filed it,” he called the Coinbase argument “removal gambit,” and said it would dismiss the “regulated land grab” claim as rhetoric that ignored state and federal securities enforcement for nearly a century.

Oregon Attorney General Dan Layfield first filed the lawsuit in April, accusing Coinbase of violating state securities laws by “promoting and promoting the sale of cryptocurrency as unregistered securities” to Oregon residents.

The state claims that Coinbase “We’ve won millions of dollars of fees as Oregonians face huge losses. In a market that’s piled up against them.”

“For many of these individuals, their damages may be too small to practically utilize individual litigation,” he says, saying Coinbase user agreements include arbitration and class action exemptions.

State and federal securities laws

The Oregon lawsuit creates fundamental legal differences between the state and federal securities laws.

Even if Crypto Asset does not qualify for security under the Federal Howey Test, you can still qualify for security under the state-level legal standards of Oregon, known as the PRATT Test.

The standard was Prattv, a 1976 Oregon Supreme Court lawsuit. It was founded in Kross and was further revealed by a later incident called “the descendants.”

The Pratt test broadens the Howey Standard by focusing on whether investors are guided primarily to expect profits from the efforts of others.

“Crypto companies try to ensure that states’ enforcement interpretations are avoided, as this could lead to a chaotic situation where all 50 states can initiate enforcement action based on the interpretations of the securities.” Decryption.

The federal SEC has retreated from Trump administration enforcement, including the withdrawal of lawsuits against Coinbase in February, but individual states claim independent powers to protect investors through their own securities laws.

Coinbase deleted the case in federal court in June, saying “state law is said to file a considerable issue of federal law.”

However, Oregon’s allegations say this fails as the state applies its own “modified” legal tests that are very different from federal standards.

Coinbase has dismissed the Oregon lawsuit as a political theatre. The exchange’s chief justice officer claims that Oregon AG “is still 2023.” “The pursuit of a patchwork of state regulations only harms politicians and consumers,” Grewal added.

The motion also accused them of working closely with Crypto issuers to list tokens on the Coinbase platform, promote them and promote sales to the public.

Oregon has requested attorneys’ fees and fees, saying Coinbase “has no objectively reasonable basis for seeking removal.”

“If every state begins to interpret qualifications as an investment contract, it can have a disastrous impact on the entire industry and certainly undermine the role of the SEC,” Rajpurohit said.

However, he said the state courts remain bound by their own Supreme Court precedent, meaning “the Oregon District Court may have to interpret the “investment agreement” in accordance with Pratt v. Cross.”