XRP Lawsuit: John Deaton Gives Update On Possible Timeline

April 18, 2022 3:12 pm

Following the court’s recent ruling to ask the SEC to produce the documents that are related to Hinman’s emails, John Deaton, the lawyer representing 65,000 XRP holders, has shared his most recent thoughts on how the timeline might play out for the remainder of the lawsuit.

In a previous tweet, Deaton had shared that his opinion was that the lawsuit would likely come to conclusion in roughly 90 days following Netburn’s decision.

The interesting thing that happened that Deaton did not really anticipate was the fact that Ripple insisting on summary judgement even without the emails and documents.

It might seem strange at first, but it might actually make sense given that Ripple is already confident about its winning position and therefore seeks to end the lawsuit as soon as possible.

Deaton affirmed that that this was very reasonable and is likely why Ripple decided to take this course of action.

FinanceFeeds reports:

“The emails and documents are most relevant to fair notice. Ripple can win on a strict Howey analysis and, if they do, the Court never has to decide whether Ripple received fair notice.

I can now see there being no settlement and the parties let the judge decide via Howey”, he continued, adding that settlement is less likely than the XRP lawsuit ending with a Judge decision.

“In other words, view the fair notice defense as insurance. It’s an issuance policy that kicks in if Ripple loses on a Howey application. Thus, I’m leaning on no settlement and a decision by the judge. The timing of a decision depends on how long it takes Judge Torres to decide”.

John Deaton further explained that the Securities and Exchange Commission has much more to lose if Ripple wins on fair notice and will keep on delaying as much as possible. By focusing on a Howey analysis, Ripple removes “the last bullet from the SEC’s gun”.

Deaton continues to share that the SEC probably is trying to find a way to minimize its losses such as by losing the trial through a Howey analysis instead of through fair notice.

The reason why the SEC wouldn’t want to lose on fair notice is because this would then apply to all other cryptos and protects them all from the SEC if the SEC decides to go after them.

Winning through the Howey analysis is probably quicker than winning through fair notice so Deaton believes that Ripple is inclined to win the case that way.

Either way, Deaton confirms that the only thing that the SEC can do now is to just delay the case as much as possible and Ripple is doing this so that the SEC can no longer have any excuses to delay the case again.

FinanceFeeds concludes:

John Deaton added that, absent a settlement, “I believe best case scenario for a ruling is late August. Worst case: just prior to Christmas because I believe the Judge would be sensitive to the 2-year anniversary.

In the meantime, the SEC has requested a two-week delay to file an objection to Judge Netburn’s non-reconsideration of her past ruling on DPP.

While that is unsurprising, the plaintiff noted that Ripple wants to proceed with summary judgment instead of waiting for the back and forth on the issues relating to fair notice. Something which Ripple has previously called “gamesmanship”.

According to John Deaton, attorney for the XRP Holders, the “biggest decision in the XRP lawsuit” was even bigger because the judge wrote a “bullet-proof” ruling that prevents the SEC to obtain an appeal for the DPP ruling.

With this, the SEC will potentially have no more excuses to delay the case anymore if Ripple decides to win on the basis of Howey analysis.

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