Ripple’s string of wins analyzed, XRP lawsuit to drag on until Spring 2022
“Absent a settlement, this case will not be decided until March 2022 at the earliest and possibly not even until late spring if the court decides not to rule on some of the pending motions until after the discovery deadline, which looks really possible”.
Thien-Vu Hogan has provided some key insights into the SEC v. Ripple lawsuit after Judge Netburn ordered the SEC to address many unanswered questions.
Although the Judge dubbed most of Ripple’s requests for admission as “theater”, she did find many of the defendants’ RFAs and interrogatories relevant to the case.
This was a clear win for Ripple as the SEC’s case is increasingly viewed as circumstantial. “The SEC is gonna be forced to argue that Ripple marketed to retail purchasers as though there was an investment contract”.
“It’s a circumstantial case, but the SEC didn’t want to come out and say that, so Judge Netburn is forcing the SEC’s hand”, said Ms. Hogan in a video.
With that being said, the SEC being forced to address all XRP sales contracts, the SEC is now in a tough position.
“It either has to admit there is nothing in writing that forms an investment contract and therefore admit that the case is circumstancial; or it can go through each and every contract and try and find something in the contract that somehow ties Ripple to people who bought XRP on Coinbase last year”.
The legal expert’s instinct is that the plaintiff is that the SEC won’t go down that road and will concede it is bringing a marketing case. But, much much like in a murder case with no hard evidence such as fingerprints or eye witnesses, “you can win that case, but it isn’t the easieast way to win.”
The Hidden Gem
The Hogan team also discussed the hidden gem found by Ripple’s counsel team, who pointed that the SEC website says whether a blockchain is fully funcional is relevant to the Howie analysis.
That is something the SEC has been trying to deny this entire litigation as the agency has even bent over backwards to say Hinman’s 2018 speech on Ethereum not being a security is not an official SEC position.
“Larsen moves to compel the SEC to contend whether “the XRP Ledger was not fully functional before the start of the ongoing securities offering alleged in the Complaint […] Defendants counter that the SEC’s own public-facing website states that whether a digital asset “is not fully functional at the time of the offer or sale” is relevant in a Howey analysis. The Court
agrees that this interrogatory seeks relevant information”, the judge wrote.
The court ordered the parties to meet and confer the definition of “fully functional” to facilitate resolution of this dispute and ordered the SEC to answer Chris Larsen interrogatory.
The court ruling proves that the Judge thinks that it relevant, no matter what the SEC says and it is going to take that into account. “That is good news, really good news”, Ms. Hogan concluded.
SEC v. Ripple won’t be decided until March 2022 at the earliest
As to the two month discovery extension to January 2022, the attorney stated that is “can only hurt Ripple” and that this court moves at its own pace, much slower than most courts, “where motions to strike affirmative defenses or to dismiss complaints are dealt with right away so the parties know what the pleadings are going into discovery”.
So, the bad news for XRP investors is that “absent a settlement, this case will not be decided until March 2022 at the earliest and possibly not even until late spring if the court decides not to rule on some of the pending motions until after the discovery deadline, which looks really possible”.