SEC v. Ripple: Judge may be “digging the fair notice defense”, said expert
The court order denying access to the firm’s lobbying efforts was most welcomed by the XRP community following the recent decision to extend discovery by 60 days.
Judge Sarah Netburn has granted in part and denied in part the list of motions filed by the SEC. The court allowed the SEC to conduct five additional depositions while denying a sixth without prejudice as unripe.
More importantly, the court denied the SEC’s request to search for records of Ripple’s General Counsel and Deputy General Counsel for being privileged communications.
The Judge also denied the production of Ripple’s documents post-dating the complaint and denied the SEC’s request for Ripple’s documents relating to its lobbying efforts.
“As discussed in the Court’s earlier Opinion and Order denying access to Ripple’s privileged communications, Ripple’s fair notice defense centers on the activities of the SEC, not its behaviors”, Judge Netburn stated.
In that earlier order, the court allowed the regulator to renew the same motion in case Ripple “raises its beliefs or relies upon its privileged communications in support of its defense – the Fair Notice defense has the potential to “save the industry from the SEC“.
“In the same vein, Ripple’s lobbying efforts regarding the status of XRP are not relevant, and my relevancy argument is outweighed by the burden of production”, said the court order dated June 15.
The court order denying access to the firm’s lobbying efforts was most welcomed by the XRP community following the recent decision to extend discovery by 60 days. A motion that was much opposed by the defendant.
James K. Filan, the attorney who made the court order public on Twitter, commented: “This is a good sign for the fair notice defense. Judge Netburn has made clear to the SEC yet again that the focus of that defense is on the activities of the SEC and not on Ripple”.
“I am getting a vibe from the Judge that she is digging the Fair Notice Defense: “Ripple’s F.N. Defense…is about the (SEC’s) state of mind whether XRP” is a security. This takes away a little sting from the 60-day extension”, attorney Jeremy Hogan tweeted.
According to attorney Hogan’s calculations, the SEC’s discovery extension ordered earlier this week is likely to push the entire case back by an equal number of days, 60.
“That would mean (quick calculations) Summary Judgment sometime in December/January. Absent a settlement, this case is going to end in early 2022!”, he tweeted.
Regulatory clarity has been the issue right from the start, which has prompted doubts on whether the SEC has given fair notice and if XRP is really a security. These matters and many more might soon be clarified as the US Congress has announced a digital assets working group.
In the meantime, a new competitor led by ex-Paypal and Ripple staff has emerged: Algorand-powered Six Clovers.