Judge Tana Lin has granted a partial default judgment against Sameer Ramani, one of the defendants in the case involving former Coinbase product manager Ishan Wahi and his co-defendants. The United States Securities and Exchange Commission (SEC) had requested the default judgment against Ramani, who has apparently fled the country and has not responded to court summonses. In addition, Judge Lin ruled that certain secondary sales of cryptocurrencies should be classified as securities.
In July 2022, Ishan Wahi and his brother Nikhil were charged with insider trading and wire fraud. The trades in question involved tokens that were scheduled to be listed on Coinbase, and were made after Ishan Wahi had informed his associates about the exchange’s plans.
Judge Lin, who presides over the U.S. District Court of Western Washington in Seattle, agreed with the SEC’s request for a permanent injunction against Ramani, as well as civil penalties and disgorgement. However, she did not agree that the defendant should be required to pay prejudgment interest on the disgorged funds. It is alleged that Nikhil Wahi and Ramani made $1.5 million from their illegal trades.
The SEC claimed that at least nine of the 25 tokens invested in by Nikhil Wahi and Ramani on the advice of Ishan Wahi were securities. These tokens include Powerledger (POWR), Kromatika (KROM), DFX Finance (DFX), Amp (AMP), Rally (RLY), Rari Governance Token (RGT), DerivaDAO (DDX), LCX, and XYO. Judge Lin accepted the SEC’s argument without challenge.
Paul Grewal, the chief legal officer of Coinbase, agreed with Judge Lin’s ruling, stating that the SEC had an “open door” in this case. Ishan Wahi initially pleaded not guilty to the insider trading charges but later changed his plea to guilty in February 2023. He was sentenced to two years in prison, while his brother Nikhil received a 10-month sentence.
Ramani’s defense counsel, David Kornblau at Denton’s, did not respond to inquiries from Cointelegraph. Additionally, the email address listed for Ramani in the court document was not accepting mail when contacted by Cointelegraph.
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