Do L$ have value or NOT??????

Oooh baby I love it when you talk Lawyer to me...

You're welcome.



I don't believe LL is screwed. I believe ditching the LindeX will solve both their problems and ours.

I certainly won't be voting for Barney Frank's bill and I have written my representatives asking them not to and stating why.



I don't believe it's pointless hectoring to post on these forums, even inspite of the people who do nothing but flame, or the ones who don't care to make any effort to understand the issues and just jump in with their best guestimates. It is in fact the only method LL makes available to us. It's not the most efficient but it serves as a means to disseminate information and discuss the issues with others.



Hopefully these forums will inspire people to stand up for their own rights as well as the rights of others.

We must all hang together, or assuredly we shall all hang separately. - Benjamin Franklin

It would be nice to hear commentary from at least one and lots more would be better.

I am not playing internet lawyer. I am simply researching the issues and stating my opinion.

heh heh - want a ride in my biplane?

Damn - looks like I've outed myself. Well, I'll stop and go back to dragging threads off topic and getting AR'ed for picking on Michael Bigwig (all in good fun - settle down). It's way more fun than mixing my boring RL up with my marginally interesting SL.

Error is always talkative.
- Oliver Goldsmith

Whatever you may think of gambling, if you're an American you may still not like the way your representatives vote for bills they don't read. The people at Downsize DC have made it easy to send a message to your congressperson and senators asking them to help put a stop to this:

http://www.downsizedc.org/read_the_laws.shtml

The text of the laws and regulations concerning the US Securities and Exchange Commission are most certainly relevant authority. However, my use of it is simply a resource to form an opinion, not an authority for citing case law. I am not making a legal argument here, just giving my opinion. As you said the "relevant law is probably there." You would know this if you accessed the link I provided multiple times. The link is the fourth one down from the top of the page and is prominently described as- "Laws & Regulations."

At the risk of repeating myself once again, but only at your insistence, I think I stated very clearly that:

It is quite possible the whole concept of LL issuing $L is completely illegal itself. Under US Federal Securities laws, it could be construed as issuing an unregistered security.

(Note that the text of the law on the very first page provides for the fact that securities must be registered and it further states why. There is also a search feature to locate filings. It also lists exemptions allowed for certain securities. "...The Act requires a variety of market participants to register with the Commission, including exchanges,...," ).

Because the $L is traded for USD on the LindeX, are they in fact issuing securities for USD? If so, that IS DEFINITELY illegal under federal securities law - virtual or not. Technically securities, for all intents and purposes, are virtual anyway because you just don't see actual stock certificates anymore. $L is no different because if you buy $L basically you are hoping someone will pay more for it, or that you can exchange it for something with value, so it appears they are acting like a company issuing stock, i.e. selling virtual securities. ALL BECAUSE THEY OWN THE LINDEX.

If this is the case, it stands to reason, LL banned gaming in SL because they fear that they are facilitating an online gaming operation and can't hide behind the "we are nothing but a chatroom really" argument. Not to mention they are going directly against their own TOS in which they state $L has no value. LL cannot sell $L and maintain an exchange, virtual or not, in their own corporation, which is exactly why they have made it a point that they are only acting as agent, but in fact they are not (because they continue issuing more $L).

The particular texts law applicable to LL are in the Division of Corporation Finance, linkable also from the main page http://www.sec.gov/divisions/corpfin/cfrules.shtml.

One point of clarification here: LL updated their blog today to discuss SL's economy - a rather positive development that is likely a direct result of the complaints on these forums. In it, they contradict their TOS which states $L has no USD value:

"L$ represents a limited license right to use certain features of the Second Life service – to participate in the virtual economy. It is a virtual medium of exchange that has real-world value associated with its ability to be traded with others, for real-world currency."

The link for that is here:
http://blog.secondlife.com/2007/08/14/the-second-life-economy/

I continue to assert, I am not making a legal argument here. Just stating an opinion and offering a solution to LL that might offer protection not only for them but for our "virtual activities" in SL and prevent the intrusion of RL laws.



Addition to the discussion, instead of flames would be refreshing. It would be nice to not have to state my opinion over and over and again, along with citations that no one reads. And if you do have access to pertinent case law, perhaps LL would like to see it.



Thank you. I understand your frustration. This forum gives frustration a whole new perspective. And btw, I have backed up what I have to say with sources repeatedly. Curiously, you haven't been frustrated with anyone else's lack of sources.

No need to make excuses for posting here Mic. We are all entitled

That's because Har said Fuck....... twice in the same post.

Sorry if I didn't respond quickly enough to your post. There are numerous posts to respond to and as you might not have noticed, I've been here all day doing nothing but that. If you check, I responded to your most recent one.

I simply asked for where she got that info, so I could read it because I obviously missed it. And no she isn't required to cite anything - apparently only I am.

I am not an ex-casino owner. I am just stating an opinion and doing so because I care about the game. If my opinion is not based in fact, then it does no damage to the future of SL or any other online world with an economy as part of it's model. I don't consider standing up for something you believe in to be a waste of time.

If you have a better solution, I'd love to hear it.

It would be nice if you would address the points being made instead of stating your opinion over and over again.

You keep asserting that L$ are at least potentially an "illegal security." I have said that I do not see how you reach that conclusion ... in what way are Linden dollars in any way like stocks/securities?

My argument is that they are just commodity items, of value only to a limited number of people, and not intrinsically valuable at all. The Lindex is like a farmer's market, not a stock exchange.

So instead of just asserting for the umpteenth time that Linden dollars might be "illegal securities," tell me why I'm wrong.

Awesome! Thanks for posting that. Hopefully some will use it.

Skipped to the end just to say:

Forget the Terms of Service. Where the TOS and the law come into conflict, the TOS will invariably lose.

Here's all you need to know:

Point 1: Linden Labs suddenly scampered to get rid of gambling in Second Life. It would be extremely naive to think that they just suddenly decided, after all that time, that they didn't like gambling in SL after all, despite having happily ignored its presence for so long. The only logical conclusion is that they either feared legal attention or were actually attracting it.

Point 2: Gambling with play money would not be illegal. Gambling with money that has real value, on the other hand, would be, at least where LL is headquartered.

The answer to the original poster's question should be quite obvious, I think.

The problem is that Lindens don't fall into the category of securities. Nobody disagrees that LL is not allowed to issue securities without regulation. But You have to look at the text of the law, which I posted earlier to see if Lindens are actually securities. I don't see how they fall into that category.

Also, I'm singling you out to give me your authority, which you still haven't done, because you made the initial argument that LL is issuing illegal securities. That's a legal argument whether you like it or not. You are also the one who said you read the law to form your opinion and told other people to go read the law. All I'm saying is point out specifically which law. Don't give me the entire body of securities law. Just give me the specific law you looked at when you formed your opinion about this matter.

That's fair, isn't it? If I'm being unfair, just say so and I'll stop.

Actually I stated that: "Under US Federal Securities laws, it could be construed as issuing an unregistered security."

My reasoning for that is $L is no different than a security because if you buy $L basically you are hoping someone will pay more for it, or that you can exchange it for something with value.

It could be argued that it is of value to a limited number of people because there are so only so many members in SL. SL does have an open membership policy for the moment, so not too sure about that.

$L clearly do have value and LL is now stating that with their update to the blog today.

"...L$ represents a limited license right to use certain features of the Second Life service – to participate in the virtual economy. It is a virtual medium of exchange that has real-world value associated with its ability to be traded with others, for real-world currency."
http://blog.secondlife.com/2007/08/14/the-second-life-economy/

I couldn't possibly tell you if you were wrong Mic. I've stated elsewhere that laws are subject to interpretation only in the judicial process. You could very well be right. What is it that makes you think they more like commodity items instead of securities?

PLEASE LL! Make another major policy change! Please make the gambling topic go away!!!!!

Which law, please?

I've been trying to get that out of her all day. I'm giving up and going away. It was more fun to try to give away my stupid no transfer biplane

Because unlike securities, people don't invest in Linden dollars. Nobody buys them and holds them in hopes they will increase in value, nor does the money paid to purchase them go to a company issuing them as capital.

As for hoping to exchange it for something of value, the only things you can exchange them for is virtual products or services inside of SL. Or you can exchange them for the same currency you paid to get them in the first place.

On the other hand, they are very much like other things people sell. Some people have them, other people want them, and they agree on a price. The same thing happens with peas, paper towels and spark plugs. None of those are securities.

Fair or unfair you have every right to post here as I do. I can't really judge the fairness of what you ask, however I continue to assert I am just giving an opinion and not making a legal argument. Attorneys make legal arguments. I am not an attorney.

I stated very clearly: "...it COULD be construed as issuing an unregistered security." My reasoning for that is: $L is no different (than securities) because if you buy $L basically you are hoping someone will pay more for it, or that you can exchange it for something with value, so it APPEARS (to me) they are acting like a company issuing stock, i.e. selling virtual securities." ( by selling - facilitating their exchange for USD by virtue of the LindeX, an exchange in which they say they are acting as an Agent. In my opinion, they are not an agent because they continue to issue $L in order to regulate the exchange rate.

Perhaps an attorney could make the legal argument that L$ are not like securities at all. I don't know. Even a promissory note is considered a security for the purposes of the Securities Act and the issuing of one is considered a "sale". There is no legal precedent for Lindens to be considered securities that I am aware of since LL is basically charting new territory. If you know of any that might apply, perhaps that would add to the discussion. Laws are subject to interpretation at every level from mine to yours, assuming you have a legal background. I do not. However, the only interpretation of any consequence would be in a courtroom.

That makes sense, although people do invest in Linden dollars and hope they increase in value. When placing a sell order, you have the option to state your sell price. Depending on the exchange rate it might take some time to fill your order, but theoretically since LL does regulate the exchange rate, one could sell them for more that what they paid.

Yes they are very much like other things that people sell, but I think what distinguishes them from commodities like peas and paper towels is that LL created them to serve as an in-world currency and only issues a limited license for you to use them, whether its to purchase something in-game or exchange them for USD. This is a pretty shady area to me, because under US law you cannot create your own real currency, yet LL specifically facilitates the trading of their in-world currency for USD in RL on the exchange. Further, LL regulates the exchange rate of the $L by issuing new $L at will.

I think the people who deposited almost $2 million L$ in Ginko might beg to differ. I think that qualifies as an investment in Linden dollars and holding them to get a higher value.

Thats not the impression Im getting from reading these threads.

nobody is holding a gun to your head and forcing you to read this. If people want to discuss answers to residents questions, they should be allowed to. I don't see the point of people posting how they dislike the topic and do not add any substance to the topic.

Just don't read it, skip over it.