In June, the Securities and Exchange Commission (SEC) sued Kik Interactive, the company behind the chat platform Kik, for conducting an illegal $100 million securities offering of digital tokens in 2017.
In its latest filing Wednesday, Kik has denied all allegations of the complaint and said:
“The Commission’s Complaint reflects a consistent effort to twist the facts by removing quotes from their context and misrepresenting the documents and testimony that the Commission gathered in its investigation. The result is a Complaint that badly mischaracterizes the totality of the facts and circumstances leading up to Kik’s sale of Kin in 2017.”
Kik’s attorneys have cited three instances showing how the regulator took quotes out of context and said that it is “a pattern that appears repeatedly throughout the Commission’s Complaint.” They said that the commission employed a strategy to “twist the facts, creating a highly selective and misleading depiction of the record.”
The filing further includes a paragraph-by-paragraph rebuttal of the arguments made by the SEC in its complaint.
Kik maintains that the kin token sale was not a securities sale. Speaking to CoinDesk, Kik CEO Ted Livingston said that the SEC was “playing dirty” by trying to “simply make [Kik] look bad,” adding:
“What really surprised us is just what lengths the SEC went to twist the facts. They cut quotes and [took them out of context] and that’s something we didn’t expect from the SEC.”
Livingston further said that both the plaintiffs and defendants have met with a judge in the U.S. Court for the Southern District of New York to decide on a timeline for going to trial. The SEC has reportedly asked for a date later this year, while Kik asked for a May 2020 trial date.
CoinDesk reported that the judge did not decide on the trial date, but chose Kik’s timetable on discovery, which will end by November 2019.
In May 2019, Kik launched Defend Crypto – a new campaign to fund its legal battle with the SEC. It said at the time that it was setting aside $5 million with Coinbase for the initiative, which also gained support from ShapeShift, Arrington XRP Capital, and others. The company later handed over Defend Crypto to the Blockchain Association.