The attorneys representing Frye and Mann have drawn a notable comparison to Taylor Swift concert tickets to underscore their argument. They contend that, similar to NFTs, Swift\u2019s tickets are resold in secondary markets and promoted by the artist herself. Yet, they argue, it would be unreasonable for the SEC to classify Swift\u2019s tickets or collectibles as securities, highlighting the potential overreach of the SEC\u2019s regulatory authority.<\/p>\n I’ve been writing a song a day for 16 years and 211 days.<\/p>\n Today, I\u2019m suing the SEC.<\/p>\n (Yes, this is real) pic.twitter.com\/QubAgbltr0<\/a><\/p>\n \u2014 16 years of song a day (@songadaymann) July 29, 2024<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n Filed in the U.S. District Court for the Eastern District of Louisiana, the lawsuit seeks declaratory and injunctive relief to prevent what the plaintiffs describe as \u201cunlawful enforcement actions\u201d by the SEC against NFT projects. This legal action reflects a growing apprehension among artists regarding the SEC\u2019s position on digital art.<\/p>\n True to his brand, Mann has released a song entitled \u201cI\u2019m Suing the SEC\u201d and has put an NFT<\/a> of the musical number up for auction.<\/p>\n The SEC\u2019s first significant enforcement action against an NFT project occurred nearly a year ago, targeting Impact Theory, a YouTube channel and podcast studio. The SEC accused Impact Theory of marketing its \u201cFounders Key\u201d NFTs as investment opportunities, suggesting that buyers could profit if the business succeeded. Consequently, the SEC classified the NFTs as investment contracts subject to securities regulations. This case was settled with Impact Theory agreeing to certain penalties.<\/p>\n Following the Impact Theory case, the SEC took action against Stoner Cats 2 LLC, alleging an unregistered NFT offering that raised $8 million. This lawsuit also ended in a settlement, avoiding a court ruling on whether NFTs are considered securities.<\/p>\n Today, @songadaymann<\/a> and I sued the @SECGov<\/a> in Louisiana federal court, asking for a declaration that the SEC can\u2019t regulate the sale of NFT art. I\u2019ve argued that the SEC is abusing its authority for years & now I\u2019m testing my theory. Here\u2019s the complaint. https:\/\/t.co\/AD8xYpV0kC<\/a><\/p>\n \u2014 Brian L. Frye (@brianlfrye) July 29, 2024<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n The lawsuit filed by Frye and Mann argues that the SEC\u2019s actions threaten the livelihoods of artists who are exploring new technological mediums. Their attorneys stress that artists now face the daunting task of possibly needing legal counsel to ensure their NFT sales do not violate securities laws. \u201cThe SEC\u2019s approach jeopardizes the creative freedom and financial stability of artists experimenting with novel, rapidly evolving technology,\u201d the complaint states.<\/p>\n In a provocative analogy, the plaintiffs\u2019 attorneys compared their situation to that of the music industry, specifically mentioning Taylor Swift. They argue that fans who purchase Swift\u2019s tickets or music might anticipate profits, and Swift actively promotes her releases. The attorneys warn that such an interpretation of securities law, if applied broadly, could be both absurd and damaging.<\/p>\n The lawsuit has sparked significant reactions within the web3 community. Katherine Minarik<\/a>, chief legal officer at Uniswap Labs, expressed her support on social media, condemning the SEC\u2019s approach as arbitrary and unlawful.<\/p>\n Wow. We have reached the point where the SEC\u2019s application of securities laws is so arbitrary and unlawful that *artists* are compelled to sue the SEC directly in order to protect their livelihoods. The SEC is broken. (And fwiw I have thoroughly enjoyed many of these songs!) https:\/\/t.co\/F6mfq2LJ6g<\/a><\/p>\n \u2014 Katherine Minarik (@MinarikLaw) July 29, 2024<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n \u201cWe have reached the point where the SEC\u2019s application of securities laws is so arbitrary and unlawful that *artists* are compelled to sue the SEC directly in order to protect their livelihoods,\u201d she wrote. \u201cThe SEC is broken.\u201d<\/p>\n \u201cIt\u2019s a shame it had to come to this,\u201d attorney Ariel Givner<\/a> weighed in. \u201cI do not hate the SEC, nor do I have any ill will towards the agency. I am, however, deeply frustrated by their current lack of regulatory clarity regarding digital assets and cryptocurrency as securities. Despite numerous requests and even lawsuits seeking guidance, the SEC has yet to provide the necessary direction. This ambiguity makes it challenging for those of us in the industry who are striving to innovate and improve the space.\u201d<\/p>\n Editor\u2019s note: This article was written by an nft now staff member in collaboration with OpenAI\u2019s GPT-4o.<\/em><\/a><\/p>\n The post Two Artists Sue SEC Over NFTs Being Classified as Securities<\/a> appeared first on nft now<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":" In a landmark legal challenge, two artists filed a lawsuit against the United States Securities and Exchange Commission (SEC) today (July 29) to seek judicial clarification on whether the agency has authority over NFTs. Brian Frye, a law professor and filmmaker, and Jonathan Mann, a songwriter known on social media as \u201cSong a Day Mann,\u201d […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[245,239,243,242,244,202,184,241,240,189],"class_list":["post-363702","post","type-post","status-publish","format-standard","hentry","category-nft","tag-azuki","tag-board-ape","tag-erc115","tag-erc721","tag-metamask","tag-nft","tag-nft-technology","tag-opensea","tag-sbt","tag-soul-bound-token"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/363702","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=363702"}],"version-history":[{"count":2,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/363702\/revisions"}],"predecessor-version":[{"id":363705,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/363702\/revisions\/363705"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=363702"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=363702"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=363702"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
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