Ripple issues first delay request as pressure over Hinman’s speech mounts

Rick Steves

The fight over the “Hinman documents” is closer to an end and Ripple has the upper hand.

The defendants in the SEC v. Ripple case have requested an extension to Friday May 13, 2022 to respond to the SEC’s renewed assertions that the agency’s internal documents related to Hinman’s 2018 speech are protected by attorney-client privilege.

In its first request for an extension since the beginning of the lawsuit, Ripple and the individual defendants, Brad Garlinghouse and Chris Larsen, ask for an extra week to build its reply, otherwise the response is due tomorrow, May 4, 2022. The SEC does not object, according to the letter.

In April 29, 2022, the Securities and Exchange Commission filed a letter objecting to the court’s decision that notes and emails related to the Hinman speech must be handed over to Ripple.

SEC has not given up on Hinman

For over a year, the SEC has refused to produce the documents, despite the court’s order to compel the plaintiff to do so. After a recent motion for reconsideration, the Judge reiterated that the notes and emails are not protected by deliberative process privilege.

In its objection to the ruling, the SEC claims “privilege applies because these documents, in whole or in part, reflect communications between Director Hinman and SEC attorneys requesting and providing legal advice about a matter under the SEC’s purview—when an offer or sale of a particular digital asset constitutes an investment contract and thus a securities offering as defined in the federal securities laws—and, correspondingly, what Director Hinman could say about this matter in the Speech.

The SEC also seeks leave to protect, under the deliberative process privilege, two additional comments in Speech drafts that satisfy the requirements of the April Order.

The SEC added it seeks to withhold the first 23 drafts “in their entirety because legal advice about digital assets is evident throughout the drafts and because, as explained below, disclosure would reveal confidential communications between SEC attorneys providing legal advice and Director Hinman who, as an SEC employee, could seek legal advice from the SEC’s attorneys and was the primary SEC official acting as client in this context.”

The SEC also seeks to withhold drafts 24 through 58 “because they reflect Director Hinman’s preliminary draft, which he submitted to SEC attorneys for comment, and the responding communications, which are predominantly legal advice. Providing portions of these documents would reveal what changed during the drafting process and consequently would reveal legal advice”.

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