Judge Sarah Netburn authorizes William Hinman’s deposition, Ripple may be hoping he thoughts XRP not a security
Thus, Magistrate Judge Sarah Netburn ordered the deposition of Williman Hinman, former director of the U.S. Securities and Exchange Commission’s Division of Corporation Finance during a recent hearing. This means Hinman could be called to testify on his 2018 comments regarding Ethereum’s security status. A small victory for Ripple if Hinman has the same thought for XRP.
Source: James K. Filan/Twitter
Ripple has notched up another small victory in its ongoing battle with the SEC
As AZCoin News reported, Ripple has put a lot of effort into bringing the former SEC director into the process of testifying about XRP to prove the blockchain company’s business is transparent. And today, it all came true.
The SEC argued that approving Hinman’s testimony would set a dangerous precedent that could deter other lawyers from taking public service jobs. But, Netburn stated that this is not a run-of-the-mill enforcement case, adding that there is a huge public interest in its resolution.
The ruling means that Ripple — unless the SEC is successfully appealed — can ask Hinman to testify about aspects of its decision-making process. The SEC has argued that Ripple’s removal request is unreasonable and unrelated to the case.
While Hinman was recently scheduled to be impeached on July 19, his testimony was adjourned by the judge so that the parties could determine its scope in advance.
— James K. Filan ???? (@FilanLaw) July 15, 2021
Back in June 2018, Hinman said that Ethereum is not a security, “current offers and sales of Ether are not securities transactions.” The court ruling could add weight to Ripple’s claim that XRP is not a security. Ripple could ask Hinman to testify about the reasoning behind his decision on ETH at the time and then attempt to apply that rule to XRP.
However, during the hearing, the SEC mentioned that it hadn’t made a decision on ETH’s regulatory status at that time. The watchdog is adamant that Hinman’s speech contained his personal remarks, though it admitted that agency staff helped draft the speech. So, maybe the SEC will continue to appeal the sentence.
However, Judge Netburn may want to see what Hinman has to say and ordered that Hinman must sit for the deposition after Ripple and SEC agree on the scope. While Thursday’s ruling is a win for Ripple, it is a relatively small procedural matter in a much larger case—one for which the outcome is far from certain. Let’s see!
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