SEC Drops Case Against HEX Founder Richard Hart, Lawyer Says

The lawyer says this is the only cryptocurrency case that has been dismissed outright by a federal judge.

Sam Reynolds | Edited by Parikshit Mishra Updated April 23, 2025, 1:27 pm Published April 23, 2025, 7:16 am

What you need to know:

• The Securities and Exchange Commission (SEC) has closed its fraud case against Richard Hart, the founder of HEX, PulseChain and PulseX.
• The case was dismissed after the SEC decided not to amend its complaint by the April 21 deadline.
• A federal judge previously dismissed the SEC's original complaint for lack of jurisdiction.

The U.S. Securities and Exchange Commission has suffered a rare legal defeat: The agency has officially closed its fraud case against Richard Schuler, better known as Richard Hart, the founder of crypto projects HEX, PulseChain, and PulseX.

On April 21, the SEC notified the Eastern District Court of New York that it would not amend its complaint, thereby ending the case.

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“This concludes the case with a complete victory for Mr. Hart,” David Kirk, a partner at Kirk & Ingram LLP who represented the HEX founder, said in an email to CoinDesk. “To my knowledge, this is the only SEC enforcement action against a cryptocurrency participant that has been dismissed outright by a federal judge.”

Earlier in February, the court dismissed the SEC's initial complaint, citing lack of jurisdiction.

Judge Carol Bagley Amon emphasized that Hart's activities were not directly aimed at U.S. investors, as CoinDesk previously reported, undermining the SEC's position.

“This is a success for open source software, cryptocurrency, and free speech. In this case, the SEC is effectively suing the software code itself, arguing that it can be a person’s alter ego,” Hart wrote on X. “This would set a dangerous precedent and could cause billions of dollars of damage to the important open source and free software industries that support much of the internet and your speech on it.”

Although the regulator was given the opportunity to amend the complaint, it refused to do so before the extended deadline of April 21.

The SEC initially filed the lawsuit

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