The SEC stated that they don’t oppose Ripple motion to seal certain portions of objections
According to the attorney closely follows the case between Ripple and the United States Securities and Exchange Commission (SEC), James K. Filan, the agency also intends to request permission from the Court to file, by September 24, 2021, its motion to seal concerning these exhibits, about submissions to SEC by third parties.
The SEC files a letter stating that it does not oppose Ripple’s motion to seal certain portions of Ripple’s objections and responses to the SEC’s second
and third sets of interrogatories.
Source: James K. Filan
SEC vs. Ripple takes a new turn
In what appeared to be a clear win for the SEC, Ripple’s request for detailed documents on the watchdog’s digital asset management transaction policy was denied by Judge Sarah Netburn.
According to Filan, the US magistrate judge refused to grant the defendants access to documents proving whether SEC employees were conducting transactions in BTC, ETH, or XRP. It was more likely to confuse than provide any relevant findings.
The regulator was previously ordered by the Court to present its cryptocurrency trading policies, leading to revelations that did not exist at the time they began investigating Ripple. The crypto company countered that when its representatives met with SEC counsel last month, it later stated that since the formal investigation against Ripple started in 2019, the SEC employees have been banned from trading in XRP.
However, according to Ripple’s statement, any official documentary evidence to support this claim has yet to be released by the regulator despite being forced by the Court.
“Defendants argue that individual trading decisions will, at a minimum, expose the lack of clarity regarding XRP’s status and whether the SEC believed XRP to be a security. Such
evidence arguably would undermine the SEC’s allegations that the Individual Defendants acted recklessly and would bolster the Defendants’ fair notice defense” Judge Netburn’s analysis in the denied motion summarized the firm’s request.
However, Netburn does not believe such an argument to be pertinent to the case, as the motion added that:
“Defendants have not shown that such individual trading decisions bear on the issues in this case. Although the SEC’s policies (or absence of policies) may provide relevant evidence related to fair notice or recklessness, how an Ethics Counsel viewed a trading decision is more likely to cause confusion or create collateral litigation disputes.”
In addition, Netburn also noted that the disclosure of financial conduct by SEC employees is protected under the Privacy Act, and Ripple has yet to provide evidence that suspending these statutory protections would make an important difference to the case.
As AZCoin News reported, Filan noted that “the Court directed the SEC to provide Defendants any documentation supporting SEC counsel’s statement during August 25, 2021, meet and confer that, after the formal order of investigation was issued as to Ripple on March 9, 2019, SEC employees could no longer trade XRP.”
While the SEC’s transaction records may currently be off-limits to Ripple, this recent movement reaffirms that the watchdog is still required to provide documentation that substantiates their claim that individuals are not allowed to do so agency staff was banned from trading XRP in 2019. Even if the SEC won this fight, the battle between the two sides is far from over.
On its part, Ripple is taking the fight to the SEC, repeatedly seeking various ways to undermine the agency’s case. On some occasions, it has been successful, on others, not so. As for how the case might eventually end, that is anyone’s guess.
- Ripple Was Denied Access To SEC Employees’ Crypto Trading Records And Holdings
- SEC Vs. Ripple Case Could Establish Limit On The Agency’ Future Involvement In Crypto Regulation