US SEC Request for Ripple’s Lobbying Efforts Rejected
In the ongoing legal battle between United States Securities and Exchange Commission (SEC) and cryptocurrency firm Ripple, the magistrate court presiding over the suit has rejected SEC’s motion praying the court to compel the crypto firm to release documents relating to its lobbying attempts. SEC alleged that the crypto firm had curried the favor of some notable parties to support them while the suit was still on.
Magistrate Judge Sarah Netburn is the presiding judge over the suit. Last month, the judge had likewise rejected SEC’s request compelling the crypto firm to release the memos and correspondence exchanged between the firm and its legal team discussing sales on XRP in 2013. The judge had cited attorney-client privilege which fosters private communication between attorneys and their clients. In her judgement, she also indicated that the crypto firm had not given up its lawyer-client right even though it is possible to do so under some circumstances.
US SEC Initiated suit Against Ripple in 2020
The suit had begun in December 2020 with the US SEC claiming that co-founders of the crypto firm were offering unregistered securities that summed up to $1.3 billion. Since then, the suit has been dragging on since then with the crypto firm scoring victories against the SEC. In the latest judgement, the Judge Netburn had said that the crypto firm lobbying attempts were not relevant to the case. Furthermore, she said if the SEC argues that they are, then the burden of proving it would lie on the commission.
US SEC alleges that the crypto firm had lobbied and paid a top ex-official of the US Commodity Futures Trading Commission to publicly indicate his support for the firm. However, the judge said in line with the crypto firm’s argument that the commission had failed to issue a fair notice to investors that XRP was an investment asset. The fair notice rule allows the court to interpret unclear and ambiguous provisions of law in favor of the defendants.
Court Overturns SEC’s Motion For Documents
Judge Netburn further overturned the SEC’s request for the release of documents and also to backdate its complaints. In May, the court cited the SEC’s eight-year delay in slamming an enforcement action on the firm following XRP’s listing on over 200 exchanges around the world, an increase in the number of transactions. However, according to the June 15 judgement, the court permitted the commission to conduct more attestations. The commission will be allowed to attest to some workers of the firm as well as its former Chief Financial officer.
Meanwhile, the crypto firm released a new On-Demand liquidity system to address cross-border payments. The launch of the ODL system coincides with the myriad of issues Small and Medium Enterprises (SMEs) face while trying to scale their businesses and reach out to clients not within their locality. XRP also released federated border chains for its network.
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