A federal judge in Utah has rejected an appeal from Kristoffer Krohn, a promoter involved in a crypto mining firm accused of fraud, seeking to dismiss a lawsuit filed by the Securities and Exchange Commission (SEC). This lawsuit alleges that Krohn and his associates were involved in a scheme that defrauded investors out of $18 million.
In a ruling made on November 26, Judge Ann Marie McIff Allen affirmed her previous decision from September 23, which allowed the SEC to proceed with its case against Green United LLC. The judge determined that Krohn had not established sufficient grounds to warrant an appeal. She emphasized that Krohn had failed to demonstrate any substantial disagreement regarding the legal standards that the court had applied in its earlier ruling.
Krohn’s defense contended that the SEC failed to prove that the “Green Boxes” offered by Green United constituted investment contracts, as alleged in the lawsuit. He argued that the SEC misapplied the criteria of the Howey test, which is the legal framework used to define investment contracts. However, the judge dismissed Krohn’s claims, stating he had inaccurately interpreted legal definitions and had not provided any judicial support for his assertions.
The SEC’s allegations stem from activity between April 2018 and December 2022, during which Green United reportedly raised funds from investors by marketing “Green Boxes” and “Green Nodes,” claiming they were capable of mining Bitcoin . In addition to Krohn’s challenge, Wright Thurston, the founder of Green United, is also pursuing a separate effort to have the lawsuit dismissed. The ongoing legal battle underscores the complexities and regulatory scrutiny surrounding cryptocurrency ventures and their adherence to securities laws.
