The SEC vs. Ripple: Battle Continues!

 Key Takeaways:

  • Judge Sarah Netburn was informed that the SEC intends to appeal the court’s recent deliberative process privilege ruling, requesting additional time. 
  • The agency has noted that the defendants are willing to move to summary judgment in the absence of a final judgment on the issue.

Securities and Exchange Commission has notified Magistrate Judge Sarah Netburn that it intends to appeal the court’s recent deliberative process privilege (DPP) order, requesting additional time to appeal. 

In a ruling on January 13, the court ordered the SEC to turn over emails related to former high-profile employee William Hinman’s contentious Ethereum speech, in which he said the cryptocurrency wasn’t a security.

Following that, the plaintiff filed a motion for reconsideration, which the judge denied earlier this week, in what some described as a big victory for Ripple.

For now, the SEC does not intend to conduct any additional discovery in the Ripple case. The defendants’ lawyers have advised the SEC that they reserve the right to raise any applicable defenses. The SEC may seek discovery in connection with any such defense in order to strike it as detrimental.

The SEC filed a complaint against Ripple and its top executives in December 2020, alleging that the defendants illegally raised more than $1.3 billion through an unregistered security asset. The plaintiff is asking for the restitution of ill-gotten gains.

Ripple co-founder Chris Larsen argued that the SEC’s claims for disgorgement and civil monetary damages were time-barred in his motion to dismiss the complaint. 

The court ruled that each transaction “constituted a separate violation of the Act.” CEO Brad Garlinghouse’s plea to dismiss was also denied.

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Baisakhi Mishra

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