A U.S. federal judge has ordered the Securities and Exchange Commission (SEC) to pay approximately $1.8 million in legal fees to Digital Licensing Inc., operating as Debt Box, in a case that has been marred by controversy and accusations of misconduct. The judge's order, filed on Tuesday, comes after the SEC's case against Debt Box was dismissed without prejudice, leaving the door open for potential future legal action.

In the order, Utah District Court Judge Robert Shelby ruled that the SEC must pay the attorney fees and relevant legal costs, stating that "the court ensures the final amount of fees requested by Defendants and the Receiver is reasonable." This decision marks a significant victory for Debt Box, which has been embroiled in a legal battle with the SEC since July 2023, when the agency filed a complaint accusing the company of defrauding investors of at least $49 million.

However, Judge Shelby has been critical of the SEC's conduct throughout the case, particularly in regards to the agency's handling of the temporary restraining order, which included an asset freeze and the appointment of a court-appointed receiver to assume control of the company. In a March filing, the judge expressed concerns about the SEC's actions, which he believed were marred by "false statements and misrepresentations."

In April, two SEC lawyers leading the case against Debt Box reportedly resigned, citing the judge's criticism and the agency's own admission of making inaccurate statements. In December, the SEC acknowledged that it had "fallen short" of expectations to be accurate and candid in court, a rare admission of wrongdoing by the agency.

Debt Box has hailed the judge's ruling as a significant step towards justice and transparency, stating in an X post that "the court has imposed sanctions on the SEC, requiring them to cover the attorney fees and costs that D.E.B.T. Box incurred during this legal battle." The company added that the case is now closed, and any future action by the SEC would need to go through Judge Shelby.

This outcome highlights the importance of judicial oversight and accountability in ensuring that regulatory agencies like the SEC act with transparency and integrity. The ruling also serves as a reminder that companies like Debt Box have the right to fair treatment and due process, even in the face of regulatory scrutiny. As the legal landscape continues to evolve, this case will likely be closely watched for its implications on the balance of power between regulatory agencies and the companies they oversee.