Thread by @propelforward

Claim by Q3 v. Tran et al re: alleged #ponzi disguised as #crypto trading venture remanded to state court by M.D. Fla after being removed to Fed. Ct. under Securities Litigation Uniform Standards Act (SLUSA); issue is if investment was in "covered" or "uncovered securities" /1

"Covered security" (needed to trigger federal court jursidiction over the matter)= Traded nationally & listed on a regulated national stock exchange. If doesn't involve covered securities, no SLUSA, no federal court jurisidction on that basis. /2

Here, the argument was that the LP interests sold by Tran et al were not covered securities but the things to be owned by those LP interests described by Partnership Agmt. included crypto & covered securities, so SLUSA should confer Jurisidiction. /3

here, as in most cases, it comes down to facts. Partnership Agmt indicated that partnership may invest in covered securities, but alleged in Complaint that primary purpose was to buy #cryptocurrency, not publicly traded stocks/bonds. /4

Court finds SLUSA "applies where the primary purpose of purchasing an uncovered security is to take an ownership interest in a covered security b/c such primary purpose creates 'a connection that matters' w/the purchase or sale of covered securities" & that the inclusion of /5

other "Investments" was incidental and amounted to a disclaimer. Action remanded back to state court.