In the latest XRP lawsuit between Ripple and the U.S. Securities and Exchange Commission (SEC), the agency has filed its response to the appeals under seal, signaling significant progress in the appeals phase of the case. This step aims to determine potential penalties the fintech company could face if the SEC succeeds in proving its allegations that Ripple engaged in unauthorized securities transactions involving its cryptocurrency XRP.
Ripple vs. SEC: detailed timeline and upcoming events
James K. Filan, a former defense attorney who has been closely following the case, update the XRP community via X (formerly Twitter), stating: “The SEC has filed, under seal, its response brief and supporting documents. These documents are not yet public. Public redacted versions will be filed by Wednesday, May 8, 2024. Additional sealing-related filings will follow.
This filing constitutes a crucial procedural step in the ongoing litigation, initiating a series of legal maneuvers centered on confidentiality and the disclosure of sensitive documents. Following yesterday’s sealed filing, Ripple and the SEC will meet today, May 7, to discuss and determine necessary redactions of the response brief and related documents, involving both parties and any third parties. This session aims to determine which information remains sealed and which will be made accessible to the public.
Tomorrow, May 8, the SEC is expected to release a publicly redacted version of the response brief as well as any supporting documents not designated as confidential or highly confidential under the current protective order. This version will only include the interim redactions requested at the May 7 meeting and conference.
Further sealing motions are scheduled for May 13, where all involved parties and third parties will file omnibus letter motions to seal all documents related to the remedy briefing. This includes submissions, statements and supporting documents, followed by submission of proposals to remove these documents.
On May 20, oppositions to the May 13 sealing motions are expected. The process states that parties are also required to file public, redacted versions of all documents within 14 days of the court’s rulings on omnibus motions to seal.
Financial issues and defense of Ripple
The stakes are particularly high, with the SEC seeking fines and penalties totaling approximately $2 billion. Ripple’s counterproposal suggests a maximum fine of only $10 million. The financial technology company opposes the SEC’s proposed injunction, saying it has instituted significant changes to prevent future violations.
Ripple’s opposition to the SEC’s restitution request is based on the assertion that the regulator has not proven that Ripple’s activities caused monetary losses to institutional investors. Regarding civil penalties, Ripple is calling for a substantial reduction, arguing that the SEC’s requests are disproportionate to penalties imposed in similar cases.
Currently, a critical battle unfolds around the testimony of expert witness Andrea Fox. Ripple disputes the SEC’s characterization of Fox’s expert statement. Ripple’s objection suggests that the SEC’s categorization of the testimony is flawed.
Jeremy Hogan, a legal expert in the XRP community, commented recently on the subject via X, saying, “I think the SEC will win this motion.” He noted that, based on the results of past cases, the court would likely recognize Fox as an expert, allowing Ripple to depose her rather than expunge her testimony from the record.
At press time, XRP was trading at $0.53761.
Featured image from Shutterstock, chart from TradingView.com
