In a new chapter of the legal battle, US regulators will have to provide Ripple with privileged documents showing that the agency previously declared that Ether is not a security.
Rippl, the company behind the cryptocurrency XRP, has just won a key court victory in its battle with the United States Securities and Exchange Commission (SEC).
A federal judge ruled Thursday that Rippl You will be able to access 2018 SEC emails related to a speech about ethereum (ETH). The access to privileged documents may be crucial to the claim against Rippl as they contain a landmark speech by a former federal agency official stating that Ether not a value (safety).
The speech in question was delivered in 2018 by former SEC director William Hinman. The official argued at the time that the ETH cryptocurrency cannot be qualified as a security due to its decentralized nature.
By then, Hinman’s remarks were seen as pivotal within the cryptocurrency industry, in part due to their place in subsequent regulations for the sector. Ether it is commonly considered as a commodity. More recently, that speech has become a cornerstone for the case of Rippl, which has been arguing that its XRP token cannot be rated as a security, just as ETH is not.
Ripple will access SEC emails
The SEC and Rippl they have been involved in a protracted legal battle since 2020, when the US regulator sued the company and its top executives for an alleged violation of federal securities law. The agency accuses Rippl having raised more than a billion dollars in a sale of XRP-tokens, which catalogs as unregistered values.
As part of the legal strategy, Rippl has sought to argue that XRP cannot be qualified as a security due to its very similar characteristics to ethereum; even under the criteria previously established by the SEC. In the process, the crypto firm has been seeking access to documents detailing the agency’s internal communication and policies.
Federal Court Judge for the Southern District of New York, Sarah Netburn, who has been handling the case, ruled this week that Rippl could access some privileged SEC documents. Among them, the Hinman speech email and some notes from the meetings between Commission officials and third parties.
Rippl He took the news as a victory for his case, as noted by the company’s general counsel, Stu Alderoty:
We are pleased with the Court’s order, which grants Ripple access to important documents that the SEC was withholding. We will continue to aggressively defend this case, and we remain optimistic that the resolution of this case will provide much-needed clarity to the industry.
Judge Netburn rules in favor of Ripple
The SEC had previously argued that the documents in question were privileged, so they were under no obligation to share them with the defendant. Likewise, the regulator has also maintained that Hinman was speaking for himself when he broadcast his 2018 speech, and that therefore it would not necessarily represent the official position of the agency.
The judge agreed with the SEC on several of the documents in question, but denied the agency’s privilege not to turn over more than a dozen batches of other documents, including the emails. Netburn ruled in favor of Rippl under the SEC’s own arguments. The judge concluded that the privilege did not apply to emails because the speech referred precisely to the personal views of the former director, not those of the agency.
“The SEC is ordered to review its privilege record and produce, in whole or in part, any documents previously withheld in reliance on privilege that would be inconsistent with this order.”, the judge wrote.
While access to documents represents a victory for Rippl, giving you possible new tools for your defence, the Court’s position could not necessarily be beneficial for the company, since the judge has admitted that the official’s speech on the qualification of ETH as a ‘non-value’ responds to his personal opinion and not to the official point of view of the regulators.
In any case, the information could help you Rippl to demonstrate how the SEC has maintained an unclear and even unjustifiably harsh position with companies in the sector. For now, the ruling is just one proceeding in an ongoing legal battle.
Article versioned by Hannah Estefanía Pérez / DailyBitcoin
Unsplash image edited in Canva