SEC v. Ripple: Lack of clarity admission is “gift from the heavens” for Ripple and XRP

“Everyone in the XRP community (including myself) owes a debt of gratitude to Commissioner Pierce/Roisman for telling the truth, first and foremost, AND in gifting Ripple this letter from officials at the SEC. It takes bravery to do that, knowing it would be used against the SEC”, said attorney Jeremy Hogan on Twitter.

The lawyer was commenting on the recent statement from SEC Commissioners Hester Peirce and Elad Roisman in connection with the SEC’s settled action against Coinschedule. The document was included in a letter from the individual defendants’ counsel as part of their motion to dismiss the case against them.

“This is the best piece of evidence we’ve seen on the Fair Notice Defense thus far and it would be Exhibit Numero Uno in my Motion for Summary Judgment”. Mr. Hogan added.

“Imagine you are the Judge deciding whether Ripple had “Fair Notice” it was violating the law and you look in the file and see a letter from 2 out of the 5 SEC heads stating essentially that “Not only Ripple didn’t have Fair Notice, NO ONE had or has Fair Notice.”

Later, in a video published on Youtube, Mr. Hogan provided a more in-depth analysis, noticing that the Fair Notice defense has come to the forefront.

The Hinman deposition is scheduled for July 27, although the SEC plans to object to any question that could fall under the deliberative process privilege.

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Now, this statement from two SEC Commissioners is likely to tip the balance in the SEC v. Ripple and the lawsuit against Brad Garlinghouse and Chris Larsen.

“And it’s relevant to both, boy is it relevant, first for the individual defendants because the standard, in that case, is that the SEC has to prove that “the Individual Defendants knew or recklessly disregarded that Ripple’s offerings and sales of XRP required registration as securities and that those transactions were improper.”

That legal standard is similar to what Ripple has to prove in its Fair Notice defense, according to the lawyer. Ripple’s claim is that it “did not have, and Plaintiff failed to provide, fair notice that its conduct was in violation of law, in contravention of Ripple’s due process rights.”

Mr. Hogan explained why Ripple Labs hasn’t filed this letter yet: “Ripple is going for the big win – summary judgment which will provide case precedent for it and all other crypto currencies. The individuals are just trying to get out fast. But by law you cannot file for summary judgment or at least have it heard, until discovery is complete and we have another couple months before discovery is closed in the Ripple case.”

The attorney linked to the XRP community then pointed to third parties “people” and “marketplaces” which limits the SEC’s moves. Instead of claiming its their personal opinion and has no legal effect, the two SEC Commissioners letter indicates that their understandings are based on discussions with people from the industry.

“I mean, you can litigate a hundred cases and never get a gift like this letter and I say it’s a gift from the Heavens because you know that the Commissioners could never comment on pending litigation.”

“And you know that Ripple could never get the Judge to make them sit for deposition, and you know that with Judicial Notice this letter had to be attached to another case like the case that just settled so that was a case the Commiissioners could comment on and they took that opportunity to put out thoughts on the confusion that exists in the marketplace.”

Also ahead in the SEC v. Ripple case is the deposition of William Hinman, July 27. Despite the probable stream of objections claiming privilege, there are expectations that the ex-SEC Director will help clarify what happened during the time of his speech in 2018 when he said Ether is not a security.