SEC Rejects Attempt to Dismiss Lawsuit Against Hex and PulseChain Founder
The Securities and Exchange Commission (SEC) has rejected Richard Heart’s attempt to have the lawsuit against him dismissed and insists it has the authority to continue the case.
According to the SEC, Heart’s request to dismiss the case ignores both the detailed allegations presented and the relevant legal standards. The commission argues that Heart’s motion overlooks the evidence and legal principles underpinning the lawsuit.
In 2023, the SEC initiated legal action against Richard Schueler, also known as Richard Heart, accusing him of raising over $1 billion through unregistered securities offerings associated with his cryptocurrency projects Hex, PulseChain, and Pulse X. The SEC alleges that Heart misused the funds, leading to extravagant purchases such as designer goods, luxury vehicles, and a rare black diamond valued at more than $4 million.
Heart’s legal team countered by arguing that he did not make specific promises to investors and that his projects operate in a decentralized manner, similar to Bitcoin. They also contended that his residence outside the United States places him beyond the SEC’s jurisdiction.
READ MORE: Kraken’s Bid to Dismiss SEC Lawsuit Denied by US Judge
Despite these arguments, the SEC maintains that Heart’s extensive involvement in U.S. events and marketing efforts targeting American investors affirms the court’s jurisdiction over the case. The SEC also pointed to claims made by Heart regarding potential returns of up to 38% from staking HEX tokens. Additionally, the regulator highlighted that PulseChain attracted investments exceeding $354 million.
Current data from CoinMarketCap shows significant declines for both PulseChain (PLS) and HEX, with losses of approximately 88.5% and 84% from their all-time highs in May 2023, respectively. The ongoing legal battle regarding the classification of these tokens as securities appears to have impacted their market value.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
