According to a recent court filing, a judge in New York’s Southern District has declared that certain emojis, such as the stock chart, money bags, and rocket ship, indicate financial advice.
Former SEC Official Issues Warning On Emoji Usage
Lisa Braganca, former SEC branch chief, has cautioned about the legal implications of emojis suggesting future gains in a tweet. She referred to a federal court judge’s ruling, concluding that emojis signify “a financial return on any investment.”
Consequently, she advised those employing such emojis to be mindful of the legal repercussions. Sharing a court filing link, Braganca informed her followers that a federal court judge named Victor Marrero disregarded Dapper Labs’ appeal to dismiss a complaint.
The complaint claimed that Dapper Labs’ NBA Top Shot Moments product violated security laws. Per the filing, the judge highlighted specific tweets the NBA Top Shot posted on its official Twitter page contained emojis that suggested financial gains.
Meanwhile, the company did not use the word “profit” in its posts. However, the judge said emojis such as the “money bags,” “stock chart,” and “rocket ship” could mean profit or financial gains from investment.
Enjin’s Chief Legal Officer, Oscar Franklin Tan, also discussed the matter and shared his thoughts. Tan stated that the ruling against Dapper Labs should not establish a risky precedent that links the use of emojis to classify NFTs as securities.
Tan argued that courts should safeguard the playful and unorthodox communication prevalent in NFT communities, as emojis and memes are integral to freedom of expression. He added that sneaker resellers could use the same approach of exploiting the “fear of missing out” and incorporating the same emojis referenced in the case.
Crypto Community And US Lawyers Reacts To The Court’s Ruling
Following the warning, the crypto community expressed their opinions on Twitter. One user expressed sadness at the news calling it “tragic,” while another user noted that the use of emojis is no longer protected under free speech.
Meanwhile, another user argued that there is a need to clarify the intended meanings behind their use of emojis. US lawyers responded to the judge’s ruling that permitted the continuation of the legal action against Dapper Labs.
Jake Chervinsky, a US lawyer, remarked that it would be “ridiculous” for a US court to classify private blockchain assets under securities. Chervinsky elaborated that such a classification could bring every major ticketing platform, travel rewards program, and video game developer under the SEC’s jurisdiction.
Lawyers also took notice of the SEC’s actions against Terra, and several took to Twitter to express their opinions. Mike Selig, a Web3 lawyer, noted that the SEC’s allegations against Terra for selling a collection of crypto asset securities meant that anything could be classified as a security under the prevailing theory.
Furthermore, attorney Justin Browder characterized the SEC’s actions as “unconventional.”
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