What’s Next for Coinbase After Judge Denies Dismissal of SEC’s Lawsuit

United States District Judge Katherine Polk Failla has denied Coinbase’s motion to dismiss the case brought forth by the US Securities and Exchange Commission (SEC) in June 2023 against the leading American exchange.

Notably, Eleanor Terrett, a journalist for Fox Business, shared the next steps for Coinbase on social media platform X (formerly known as Twitter), adding that the Court will now set a full discovery schedule, and each side can request documents for the discovery process.

“Some of this case could be undermined and exposed through discovery, so Coinbase will attempt to get as much discovery on the SEC as they can during this process, and the SEC will do the same,” sources told Terrett.

While referring to the discovery phase in the XRP lawsuit, Terrett said that the phase will act like a “window” to the mind of the SEC in the lawsuit against Coinbase.

Further, the journalist also predicted that the case will drag on for at least a year because discovery can take “many months” and then follows “the process of filing summary judgment briefs and then a potential trial on top of that,” while adding:

In the meantime, I’m told one of Coinbase’s more near-term options could be to file an “interlocutory appeal” on some or all parts of the denial of Motion To Dismiss if their lawyers think that it makes sense to do so.

Notably, the SEC filed for an interlocutory appeal in the XRP lawsuit but was denied by Judge Analisa Torres, who made the historical decision that XRP was not a security when sold to retail investors.