August 13, 2025 — FINRA’s motion to quash subpoenas now aims to destroy transparency in a case tied to the MMTLP scandal.
The Financial Industry Regulatory Authority (FINRA) has filed a motion to quash subpoenas in a case tied to the controversial trading halt of Meta Materials Series A Preferred Shares (MMTLP), intensifying tensions with retail investors seeking answers about alleged market manipulation.
The motion, filed in the Meta Materials bankruptcy case, aims to block the release of critical trading data, including over 23.5 million trade records related to MMTLP, Meta Materials (MMAT), and Torchlight Energy Resources (TRCH).
Retail investors, particularly the vocal MMTLP community, are expressing outrage on X, arguing that FINRA’s actions obstruct transparency and protect bad actors at the expense of everyday shareholders.
MMTLP, issued during the 2021 merger between Meta Materials Inc. and Torchlight Energy Resources, was intended to represent economic interest in Next Bridge Hydrocarbons, a private oil and gas spin-off.
Unexpectedly, these preferred shares began trading on the over-the-counter (OTC) market, drawing significant retail investor interest.
However, on December 9, 2022, FINRA imposed a U3 trading halt, citing concerns about settlement issues.
FINRA stated, “halting trading and quoting in MMTLP is necessary to protect investors and the public interest.”
The halt froze trading, leaving over 65,000 shareholders unable to sell their positions, many of whom faced significant financial losses.
Investors received private Next Bridge shares, which cannot be traded on public exchanges, leaving them with no clear path to recoup their investments.
The MMTLP community has since argued that the halt was designed to protect short sellers from closing their positions, pointing to potential naked short selling and market manipulation.
FINRA’s Motion to Quash: A Barrier to Accountability?
On August 6, 2025, FINRA filed a motion in the Meta Materials bankruptcy case to block nine subpoenas seeking trading records and a Rule 2004 examination.
These subpoenas, initiated as part of the bankruptcy proceedings, demand data from FINRA, the Depository Trust Company (DTCC), and several brokers, aiming to uncover evidence of market irregularities.
FINRA argues that producing the requested data, including over 23.5 million trade records, would be “overly burdensome” and potentially compromise sensitive information.
The motion has reignited long-standing concerns among retail investors about FINRA’s transparency.
Troy Eads, FINRA’s Senior Director Data Lead, is expected to submit a declaration detailing the organization’s data management practices, the confidentiality of its records, and the logistical challenges of complying with the subpoenas.
The declaration will likely argue that releasing such data could harm individuals and firms, disrupt FINRA’s operations, and set a precedent for future disclosures in bankruptcy or fraud investigations.
MMTLP Community Reactions on X: A Call for Justice
The MMTLP community, a highly active group of retail investors, has taken to X to voice their frustration and demand accountability.
Posts on the platform reflect deep distrust in FINRA and the Securities and Exchange Commission (SEC), with many accusing regulators of shielding powerful financial institutions.
@MindandEmotion7 warned that if FINRA’s motion succeeds, it could “set a national precedent” allowing the regulator to avoid handing over raw market data in future investigations, effectively killing transparency in cases of alleged fraud.
@xMarketNews highlighted the scale of the data FINRA seeks to withhold, stating, “FINRA argues the subpoenas would be overly burdensome, requiring production of more than 23.5 million trade records $MMTLP. Isn’t that their job? ”
@RareDealsHere questioned FINRA’s motives, suggesting the halt was not about investor protection but rather to shield short sellers.
They referenced Freedom of Information Act (FOIA) requests revealing internal FINRA discussions about MMTLP, stating, “FOIA’s reveal that FINRA already had a good reason to protect investors by NOT processing the Corporate Action due to ongoing investigations/suspicions.”
@kshaughnessy2 criticized the SEC’s reluctance to fulfill FOIA requests, noting, “Transparency is hard for our regulators,” in response to delays in a January 2025 FOIA request about MMTLP.
@ggkoul shared a FOIA-revealed email from December 12, 2022, indicating an internal FINRA meeting about MMTLP just days after the halt, raising questions about what regulators knew and when.
The community’s activism extends beyond social media.
Investors have sent over 435,000 emails to regulators, filed multiple FOIA requests, and supported lawsuits, including one by shareholder Scipio X against FINRA and another by Mark Basile requesting MMTLP blue sheet data.
Retail Investors Have The Stage
The MMTLP case has become a rallying cry for retail investors, exposing flaws in market oversight and investor protections.
The community’s allegations of naked short selling and synthetic shares have drawn attention from lawmakers, with over 70 members of Congress, led by Representative Ralph Norman, demanding answers from FINRA and the SEC in 2023.
Despite these efforts, FINRA’s responses have been criticized as inadequate, with heavily redacted FOIA documents fueling perceptions of a cover-up.
The MMTLP community remains steadfast, supported by figures like former Torchlight CEO John Brda and media outlets like The Robb Carter Show, which has dedicated multiple segments to the issue.
Investors are also hopeful that the Meta Materials bankruptcy case, which prompted the subpoenas, could expose evidence of wrongdoing, potentially leading to settlements or regulatory action.
The outcome of FINRA’s motion to quash could have far-reaching implications.
A successful motion might shield critical data from scrutiny, reinforcing perceptions of regulatory opacity.
Conversely, if the court denies the motion, the release of trading records could validate investor claims of manipulation, paving the way for compensation or systemic reforms.
For now, MMTLP investors are left in limbo.
The community’s resilience is evident in their ongoing advocacy, from social media campaigns to legal challenges.
The MMTLP saga underscores a broader struggle for retail investors seeking fairness in a system often perceived as favoring institutional players.
As the case unfolds, the community’s fight for transparency and justice continues to resonate, amplifying calls for a fair market for all.
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