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September 13, 2023 at 05:30 PM
The creator of animated series Stoner Cats, which featured actors Mila Kunis and Ashton Kutcher, agreed to pay $1 million to settle U.S. Securities and Exchange Commission charges that it offered NFTs that were really unregistered securities.
Stoner Cats 2 LLC was charged with illegally raising about $8 million from investors to finance the web-based series through the sale of more than 10,000 nonfungible tokens at about $800 each in the span of 35 minutes on July 27, 2021, the SEC said in a statement Wednesday.
The entity didn’t admit or deny any wrongdoing as part of the settlement.
The order found that both before and after the NFTs were sold, Stoner Cats 2’s marketing highlighted specific benefits of ownership, including the option to resell them in the secondary market, the agency said.
The settlement was the second action in about two weeks by the SEC against an NFT issuer for offering unregistered securities.
“Stoner Cats wanted all the benefits of offering and selling a security to the public but ignored the legal responsibilities that come with doing so,” Carolyn Welshhans, associate director of the SEC’s Home Office, said in a statement.
Skadden, Arps, Slate, Meagher & Flom LLP, which represented Stoner Cats 2, declined to comment.
In order to watch Stoner Cats, which also featured actor Chris Rock, and Ethereum co-founder Vitalik Buterin, viewers had to purchase the show’s original NFT artwork.
