Arkansas Cryptomining Association Sues State Officials Over Discriminatory Rules

The Arkansas Cryptomining Association is suing two Arkansas state officials, arguing that they enforced an unconstitutional and discriminatory state rule

The Arkansas Cryptomining Association (ACA) has sued two Arkansas state officials for enforcing an unconstitutional and discriminatory state rule that prohibits foreign-born American citizens from engaging in crypto-mining activities in the U.S. state.

The complaint, which was filed against Arkansas Attorney General Tim Griffin and the director of the Arkansas Oil and Gas Commission Lawrence Bengal on March 13, in the U.S. District Court Eastern District of Arkansas, follows a federal court ruling last November.

The ruling saw a judge from the same court temporarily block Arkansas from preventing a naturalized U.S. citizen of Chinese descent from operating a crypto mining business in the state.

The case centers around two Arkansas state rules, “Rule K” and “Act 174,” which prohibit businesses in the state from being controlled by foreign parties.

The crypto association’s director Connor L. Kempton said in the complaint that due to their broad language, Rule K and Act 174 give the defendants arbitrary and discriminatory enforcement powers, which enable them to grant or deny permits at their own discretion.

The complaint, which was in part written by the pro-bono legal organization Institute for Constitutional Law, adds that the application of Rule K and Act 174 can be discriminatory based on race, alienage and national origin, among other things.

Excerpt from the ACA’s complaint against Bengal and Griffin. Source: Court document reviewed by Cointelegraph

The complaint follows a case filed by the crypto association last year after the Arkansas officials began enforcing the state rules against crypto mining firm Jones Eagle LLC, which is run by Qimin “Jimmy” Chen, a naturalized U.S. citizen of Chinese origin.

The association’s lawsuit claims that the officials’ actions are unconstitutional and violate the Equal Protection Clause of the 14th Amendment of the U.S. Constitution.

The Equal Protection Clause similarly prohibits the U.S. states from denying any person equal protection of the laws based on the person’s race, alienage or national origin.

The crypto mining executive also argued that Rule K and Act 174 strip American citizens like Chen of due process rights under the 14th Amendment.

Kempton added that the prohibitions and penalties imposed under Act 174 infringe on the federal government’s authority to investigate, review and take action on foreign investments.

The case also follows Judge Kristine G. Baker’s December 9 ruling, which barred the Arkansas officials from enforcing Act 174 against Jones Eagle until further notice.