XRP lawsuit: Judge seals evidence that could prove SEC lied to court

Rick Steves

Judge Netburn has granted the motion on an interim basis as the Court may reconsider its ruling when it considers the merits of the underlying motion.

Judge Sarah Netburn has ruled in favor of Ripple’s request to seal exhibits A and B contained in the defendants’ response to the SEC’s submission of three additional documents for the in-camera review.

At the time of Ripple’s motion to seal, the defendants said they “conferred with the SEC and understand that it does not object to filing these materials under seal, pending the SEC’s opportunity to review the submitted materials and evaluate whether to ultimately request sealing.

Ripple and the individual defendants Chris Larsen and Brad Garlinghouse have not taken a position on the ultimate confidentiality of these materials.

These, however, are part of the “discovery materials filed with the court in connection with discovery-related disputes,” that were designated as Confidential by the producing party. As such, they are not judicial documents and are not entitled to a presumption of public access, Ripple’s counsel argued.

Exhibits A and B are part of the discovery materials exchanged between the parties through a compulsory process to facilitate orderly preparation for trial, not to educate or titillate the public.

Judge Netburn has granted the motion on an interim basis as the Court may reconsider its ruling when it considers the merits of the underlying motion.

The three additional documents for review

The SEC was ordered to deliver the three documents after Ripple’s successful motion to compel.  The documents include:

  • the January 28, 2019 email chain: SEC forum on digital assets
  • the October 25, 2018 email chain: meeting between SEC staff and industry participants on digital assets
  • September 9, 2019 email chain on a distributed ledger technology firm’s request for possible no action relief

The SEC claims these documents are privileged under the deliberative privilege process (DPP), including the one where the SEC told a third party to analyze its digital asset under the framework of Hinman’s speech.

That document is likely to put further pressure on the SEC’s position that Hinman’s speech was not official SEC policy, but only his personal opinions.

More on that: Ripple could prove SEC lied to court about Hinman’s ‘personal opinions’

Besides the SEC’s misstep in court, Ripple can use these documents to further pursue its fair notice defense, given the agency’s seemingly contradictory positions in regard to the regulatory guidance and enforcement.


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