By Brenda Collins
In a recent report, Ripple Labs has formally rejected the latest motion brought up by the United States Securities and Exchange Commission (SEC), which sought to coerce the submission of post-complaint documents in the current court case between them. Defending itself, the crypto firm claimed that the SEC’s request was not related to the case at hand, adding that the commission had ample time to make the request during the fact-discovery stage of the case, which ended in August 2021.
According to the report, the longstanding legal brawl between the US SEC and Ripple Labs (issuer of XRP tokens) took a new turn after the regulatory commission filed a motion requesting the court to compel Ripple to release its post-complaint documents. The new development showcased a pivotal turn in the case as it points out the challenges of complying with regulators in the digital assets sector.
Ripple States Reasons For Its Opposition
Furthermore, the report revealed that Ripple has responded negatively to the motion, stating two main points that centered on the timing and relevance of the documents to the ongoing legal brawl as reasons for its refusal to give up the post-complaint files as required by the SEC’s motion.
The crypto firm stated that the timing for the provision of the documents in question was wrong, claiming that the SEC had enough opportunity during the fact-discovery stage of the case, which ended back in August 2021, to ask for these documents. The firm argued that for the commission to seek the documents now after its failure to do so at the earlier stage showed its lack of justification.
Also read:In addition, the crypto firm highlighted that during the fact-discovery phase, there were prior legal rulings concerning how appropriate post-complaint documents are, of which the SEC reportedly considered such information irrelevant. Standing on this, Ripple Labs claimed that it would be inappropriate and biased for the court to allow the SEC to change its perception about the documents now.
Second Argument From Ripple
Additionally, Ripple Labs started its second argument, questioning how the information the SEC sought after relates to the case at hand. The firm further argued that the data contained in the document the commission wants would in no way influence the court’s verdict when the time for the final judgment on the longstanding case comes.
Furthermore, the crypto company pointed out that the US Securities and Exchange Commission had exhausted all the interrogation options allotted to it in the case, and it is appropriate for the commission to be seeking more information outside the interrogation limit the two agreed upon.
The new move by Ripple to oppose the SEC’s motion is vital to the ongoing legal brawl between the two parties. According to the motion filed by the SEC for the remedy stage of the case, Ripple is requested to submit its audited financial statements for 2022/2023, as well as the records for XRP sold to institutions from December 2020 till date. This stage targets the determination of the possible punishment for Ripple Labs for allegedly breaching the standards of the US securities laws via its XRP deals.
The Two Parties Struggle To Win
Meanwhile, Ripple’s stance against the motion raised by the commission showcased the potential implication of the case on the digital assets industry. The court’s verdict on this case could serve as a precedent for how the US securities laws would apply and regulate the crypto industry. To that end, both warring parties, the SEC and Ripple Labs, are exerting enormous efforts to win the case in the long run.
As it stands, the United States District Magistrate Sarah Netburn holds the authority to decide the final verdict on the case, and she is yet to schedule a formal date for her judgment. Nonetheless, the phase related to remedies discovery is set to end on February 14, after which the final decision would be next in line. Netburn’s verdict would be a pivotal event that could significantly influence the regulatory standards for digital assets in the US.
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