Ripple lawsuit might end in August with ruling on XRP – John Deaton
“The SEC has only one area of leverage over Ripple: delay. This is Ripple removing the last bullet from the SEC’s gun”.
As Ripple and the SEC prepare for the next chapter in the XRP lawsuit following the court’s final ruling on the deliberative privilege process – ordering the SEC to ultimately produce emails and notes related to the 2018 Hinman’s speech – John Deaton has turned to Twitter to provide some insights on what to expect.
John Deaton, an attorney that represents over 65,000 XRP Holders in the SEC v. Ripple, has previously said that the lawsuit would come to an end within 90 days from Judge Torres affirming Judge Netburn’s decision.
“I still stand by that, however, I didn’t really consider Ripple insisting on Summary Judgement without the emails and documents. In hindsight, it makes sense”, he stated.
XRP lawsuit ends by Judge ruling, not settlement
“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”.
“I can assure you the SEC would rather lose the case on a strict Howey analysis than on fair notice. If she rules Ripple lacked fair notice, most Altcoins, traded for the last 7 years, have a blueprint for victory. If the Court finds XRP not a security, it applies only to XRP.
“Ripple could also move for partial summary judgment on certain issues. For example, Ripple wants to win on a straight Howey analysis before ever getting to the fair notice issue. Maybe Ripple moves for summary judgment on today’s XRP.
“Bottom line, this is a smart move”, he continued. “The SEC has only one area of leverage over Ripple: delay. This is Ripple removing the last bullet from the SEC’s gun”.
XRP lawsuit ends in August, best case scenario
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.