The United States Securities and Exchange Commission (SEC) and the software firm Kik are finally putting an end to their ongoing dispute that has lasted for a year. They have jointly presented a settlement proposal that will require Kik to pay a fine of $5 million. Both the U.S. SEC as well as Kik have agreed on this settlement proposal.
A dispute over a 2017 token sale
The dispute between the US SEC and Kik is over an Initial Coin Offering (ICO) token sale that took place back in the year 2017. It started last year in 2019 when the Securities and Exchange Commission charged Kik for conducting an unregistered and illegal $100 million worth of initial coin offering of crypto assets. In the complaint, the SEC said that Kik Interactive did not register its token sale offering and despite that, it sold a large number of tokens to investors in the United States. Hence it violated the regulations and laws of the SEC.
That legal fight has been continuing until now when both of them have entered into an agreement and have decided to end this yearlong legal battle finally. As the document stated:
“The parties have reached agreement on a proposed judgment, and file herewith a Consent executed by Kik Interactive Inc. (Exhibit A) and a proposed Final Judgment (Exhibit B). The proposed Final Judgment, if approved by the Court, would permanently enjoin Kik from committing future violations of Section 5, pursuant to Section 20(b) of the Securities Act of 1933, 15 U.S.C. § 77t(b)…”
However, as per public court documents, the settlement that has been proposed by them is yet to receive approval from Alvin K. Hellerstein, the presiding federal District Court Judge. As soon as the settlement proposal gets approved by the Judge, the dispute between them will come to an end permanently and officially.
Similarly, the United States financial regulator also sued the social media messaging platform Telegram. The legal fight between SEC and Telegram was on the latter’s proposed blockchain project known as the Telegram Open Network (TON). Telegram had to abandon its TON project after this court fight with the US financial regulator.