XRP Lawsuit: Judge Torres Overrules The SEC’s Hinman Objections

September 30, 2022 9:50 pm Comments

The market reacted positively to recent news this past week as it was recorded that XRP had jumped by around 9% on Thursday.

This was due to Judge Torres ruling in favor of Ripple in regards to the release of documents from the SEC which includes the 2018 speech given by William Hinman (former director of the SEC).

Hinman’s speech is especially important for the lawsuit because Hinman had stated in the speech that ether was not considered a security. and Ripple could use this as a point to prove that XRP is also not a security.

The recent ruling by Judge Torres is considered significant as the SEC had been withholding such documents multiple times throughout the case so far.

Now that the judge has overruled the SEC, speculators are expecting this to be a key turning point for the lawsuit.

Blockworks.co reports:

Ripple’s defense is based on the argument that if ether was not considered a security at the time, then why should XRP — which is arguably more like a currency — be subject to securities rules? Or so the thinking goes.

In December 2020, the SEC filed suit against Ripple as well as former and present CEOs Brad Garlinghouse and Chris Larsen, alleging the company and its executives violated securities laws in 2013 when they sought to raise funds without first registering with the agency.

Central to the case has been the discovery of documents, including emails, relating to Hinman’s remarks, which the SEC has attempted to argue fall under deliberative process privilege (DPP).

DPP protects certain pre-decisional, internal agency information from disclosure during litigation and is a fairly common provision within most established democracies, including in the US and Australia.

Both parties to the lawsuit agreed that the case should be decided by Judge Torres in a summary judgement expected in the coming months.

When the news was first released, XRP turned out to be the biggest gainer the following day followed by other top competitors such as Stellar (XLM).

In comparison, Bitcoin had only increased by roughly 1% on that day which signals that there is strong optimism for specific assets in the market.

The case was initially seen as unlikely odds for Ripple early on in the lawsuit, but it seems that a settlement is now the most likely as both parties have already filed motions for summary judgement.

The motions were filed on the 17th of September and the upcoming summary judgement may be the next big thing that will determine how the lawsuit will ultimately unfold.

CoinTelegraph reports:

Ripple Labs scored a victory in its continuing legal battle with the United States Securities and Exchange Commission (SEC) on Sept. 29 as U.S. District Court Judge Analisa Torres ruled to release the documents written by former SEC Corporation Finance Division Director William Hinman.

The documents predominantly relate to a speech Hinman delivered at the Yahoo Finance All Markets Summit in June 2018.

Hinman stated in his speech that Ether (ETH) was not a security. Ripple Labs considers the speech a key piece of evidence the case the SEC has brought against it alleging that sales of Ripple’s XRP violated U.S. securities laws — though time has yet to tell whether the language used in the speech will be as meaningful as the company suggests.

The circumstances surrounding the speech and Hinman’s actions leading up to it are a source of considerable confusion.

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