Lawsuit: Pending TheStockExchange LLC vs. President Fontaine [2026] FCR XXX

[Muggy21]

Motion

IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT
EMERGENCY INJUNCTION

Plaintiff respectfully prays for the following:

1. An interim injunction, for the duration of this case, prohibiting the Department of Commerce from collecting any fee under Section 16(12) from the Plaintiff, and from taking any action under Section 18(3) of the Redmont Commerce and Finance Actagainst the Plaintiff on the ground of non-payment of such a fee.
2. An interim order, for the duration of this case, tolling the periods in RCFA Section 59(5) as they apply to the Plaintiff, such that the period for filing a capital plan and the period for meeting the capital requirement in Section 16(5) begin to run again only from the date of final judgment, and prohibiting the Department from acting under Section 59(6) or Part X against the Plaintiff on the ground of non-compliance with those requirements during that time.

GROUNDS FOR THE MOTION

I. Urgency
1. The RCFA was enacted on September 12, 2026. Under Section 59(5), the Plaintiff must file a capital plan with the Department on or about October 12, 2026, and must hold capital of $250,000 by on or about December 11, 2026. Section 59(5) provides that "the Department may not extend" this period. Only this Court can grant relief before those dates pass.
2. Under Section 16(12)(e), the supervisory fee challenged in this action is payable with each of the Plaintiff's monthly reports. Each reporting period that passes without relief results in a further payment of a charge the Plaintiff contends is unconstitutional.


II. On the Merits
3. Plaintiff has a strong case on the merits. The Constitution provides that "Congress controls taxation, government spending, appropriations, and borrowing." Section 16(12) permits the Department of Commerce to set, by its own rule, a mandatory charge of between 1% and 5% of a license class's capital figure, paid into the general DCGovernment account. A compulsory charge that funds general revenue, is calculated from a capital figure rather than the cost of any service, and is enforced by the threat of license revocation is a tax in substance. The RCFA itself requires that substance prevail over form (Section 4(1)(a)).
4. Congress retains no binding control over the rate. The only check the RCFA provides is disallowance by "resolution" under Section 7(7), and the Constitution defines resolutions as non-binding. By contrast, in the Taxation Act enacted the same day, Congress provided that every tax rate "may be changed only by an Act of Congress."


III. Irreparable Harm
5. If the Section 59(5) period expires before judgment, Section 59(6) requires the Plaintiff to surrender its Class F license or change its license class. Either outcome would end the Plaintiff's liability to the Class F fee, could deprive the Plaintiff of standing, and could render this case moot before the constitutional question is decided. The loss of the ability to obtain a ruling at all is harm that cannot be remedied after the fact.
6. Surrendering the license would also require the Plaintiff to cease operating its exchange and return customer funds under Section 59(6), causing lasting damage to its business, its listed companies and their investors that no later judgment could undo.
7. The alternative, meeting the capital requirement, is also irreversible in practice. Section 16(8) prohibits disposal of the capital for 90 days after licensing and makes any transaction returning it to an owner voidable by the Department. If the Plaintiff prevails, those funds could not be promptly freed.

 

[Muggy21]

Case Filing

IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT
CIVIL ACTION

TheStockExchange LLC
TSEInvestmentBank LLC
Plaintiffs

v.

President Fontaine, in his official capacity
Commonwealth of Redmont
Defendants

COMPLAINT
The Plaintiff complains against the Defendant as follows:

WRITTEN STATEMENT FROM THE PLAINTIFF

The Constitution provides that "Congress controls taxation, government spending, appropriations, and borrowing." Section 16(12) of the Redmont Commerce and Finance Act nonetheless allows the Department of Commerce to set, by its own rule, a mandatory annual charge of between 1% and 5% of a licence class's capital figure, paid into the general government account. Whatever it is called, this is a tax, and its rate is set by the Executive rather than by Congress. The only check the Act gives Congress is a "resolution," which the Constitution defines as non-binding. The Stock Exchange is now required to pay this charge. I ask the Court to declare Section 16(12) unconstitutional and sever it from the Act.

I. PARTIES
1. TSEInvestmentBank LLC (Plaintiff), hereinafter "TSE"
2. President Fontaine (Co-Defendant)
3. Commonwealth of Redmont (Co-Defendant)

II. FACTS
1. The Redmont Commerce and Finance Act ("RCFA") was granted Presidential Assent and enacted on September 12, 2026.
2. TSE was registered as a Stock Exchange before that date and, under RCFA Section 59(1)(d), is deemed to hold a Class F licence. (P-002)
3. RCFA Section 16(5)(c) sets the capital figure for a Class F Stock Exchange at $250,000.
4. RCFA Section 16(12) provides that "The Department may by rule set fees for each license class," including "(a) an application fee, not exceeding 1% of the capital figure for that class" and "(b) a supervisory fee, payable on the same cycle as the institution's reporting period under section 31, of not less than 1% and not more than 5% of that capital figure in aggregate over any 12 month period."
5. RCFA Section 16(12)(g) provides that "fee revenue is directed to the DCGovernment account." The Act does not reserve that revenue for the costs of supervision.
6. RCFA Section 16(12)(h) provides that "an unpaid fee is recoverable as a debt and is a ground for action under section 18(3)," which permits the Department to refuse, condition, suspend or revoke a license.
7. Under RCFA Section 31(1)(a), every holder of a Class F license is a Tier 1 reporting person and reports monthly, regardless of its size. Under Section 16(12)(e), the supervisory fee is payable with each report.
8. As of September 26th, 2026, the Department has failed to provide the fee structure for any license.
9. As of September 26th, 2026, the Department has failed to provide guidance as to how these taxes will be payable.
10. RCFA Section 7(7) provides that "Congress may disallow a rule by resolution of both chambers."
11. In the Taxation Act, enacted by the same Congress and assented to on the same date, Congress provided that balance tax rates "may be changed only by an Act of Congress" (Section 6(2)) and that the chestshop sales tax rate "may be changed only by an Act of Congress" (Section 13(3)).
12. RCFA Section 59(5) provides that an institution licensed under Section 59(1) "has 90 days from the enactment of this Act to meet the capital requirement in section 16(5), and shall file a plan to do so within 30 days. This period is a maximum and the Department may not extend it." With enactment on September 12, 2026, the plan is due on or about October 12, 2026 and full compliance on or about December 11, 2026.
13. RCFA Section 59(6) provides that an institution that does not meet the requirement within that period "shall either surrender its license and return customer funds in an orderly manner, or apply for a license class whose requirement it does meet."
14. RCFA Section 16(8) requires the capital to be held in unencumbered liquid assets and prohibits its disposal for 90 days after licensing. A transaction returning that capital to an owner is voidable at the instance of the Department.

III. CLAIMS FOR RELIEF

Claim 1: Section 16(12) imposes a tax by Executive rule, contrary to Congress's Power of the Purse
4. The Constitution is "the highest law of the Commonwealth" and "overrides any law or authority that conflicts with it." Under Part I, Section 2 (Powers of Congress), clause (4), "Congress controls taxation, government spending, appropriations, and borrowing."
5. Section 23 of the Constitution confines the Executive to administering and enforcing the law "as written by the legislature." It does not permit the Executive to set the rate of a tax.
6. The supervisory fee under Section 16(12)(b) is a tax in substance, for the following reasons:
(a) Its revenue is paid into the general DCGovernment account under Section 16(12)(g), and is not reserved for, or limited to, the cost of supervising the payer.
(b) It is calculated by reference to a statutory capital figure, not the cost of any service provided. The mandatory floor of 1% applies even where the Department's actual cost of supervising an institution is negligible.
(c) It is compulsory, recoverable as a debt, and enforced by the threat of license revocation.
(d) The rate is uniform across each license class under Section 16(12)(c), rather than individually assessed against the supervisory work performed.
7. The RCFA itself directs that "the economic substance and practical effect of a transaction, instrument or arrangement prevails over its legal form, label or characterisation" (Section 4(1)(a)). The Defendant cannot rely on the label "fee" to avoid the constitutional requirements that govern a tax.
8. Section 16(12) permits the Department to choose the rate anywhere within a fivefold range. The decision of how much tax a class of citizens must pay is therefore made by the Executive, not by Congress. That is a transfer of a power the Constitution reserves to Congress.
9. Congress's own practice confirms that it regards setting tax rates as its exclusive function. In the Taxation Act, enacted the same day, Congress provided that each tax rate "may be changed only by an Act of Congress." RCFA Section 16(12) departs from that principle without justification.
10. RCFA Section 16(12) is therefore inconsistent with Part I, Section 2, clause (4) of the Constitution and is void.

Claim 2: Congress retains no binding control over the rate, so the delegation cannot be sustained
11. If the Defendant argues that Congress controls the charge by having set its range, that argument fails because the Act leaves Congress no binding means to control the rate once the Department sets it.
12. The only mechanism the RCFA provides is Section 7(7), which permits Congress to "disallow a rule by resolution of both chambers."
13. Under Part I, Section 2 (Powers of Congress), clause (5), resolutions are "non-binding" instruments passed "to express opinions or make formal requests." A non-binding resolution cannot lawfully void a rule. Section 7(7) purports to give a resolution a binding legal effect that the Constitution denies it.
14. Congress's only binding remedy is therefore to pass a new Act, which is subject to Presidential veto and can be overridden only by a supermajority. In practical terms, the Executive sets the rate of a revenue charge and Congress cannot prevent it by ordinary legislative means. That is not Congressional "control" of taxation within the meaning of clause (4).

Claim 3 (in the alternative): The rate set is not proportionate as the Act requires
15. If the Court finds that Section 16(12) validly delegates the setting of a regulatory fee, the rule setting the Class F fee is nevertheless invalid. Section 16(12)(d) requires that "a fee must be proportionate to the supervisory burden the class imposes," and Section 7(2) requires every rule to be "reasonably tailored" to a legitimate purpose.


Severability
17. RCFA Section 62 provides that "If any provision of this Act is held invalid or unenforceable, the remainder continues in full force and effect." Section 16(12) can be struck without affecting the operation of the rest of the Act.


IV. PRAYER FOR RELIEF
The Plaintiff seeks the following from the Defendant:
1. A declaratory judgment that RCFA Section 16(12) is inconsistent with Part I, Section 2 (Powers of Congress), clause (4) of the Constitution and is void, and that it is severed from the Act under Section 62.
2. A declaratory judgment that any rule made by the Department of Commerce under Section 16(12) is void.
3. In the alternative, a declaratory judgment that the rule setting the Class F supervisory fee is invalid for failing to meet Sections 7(2) and 16(12)(d) of the RCFA.
4. Legal fees and court costs as permitted by law.
5. Any other relief the Court considers just.

EVIDENCE
P-002: <https://www.democracycraft.net/threads/tse-investment-bank.35259/>



WITNESSES
None

By making this submission, I agree I understand the penalties of lying in court and the fact that I am subject to perjury should I knowingly make a false statement in court.

DATED: This 26th day of September, in the 2026th year of Tuk.