Important update on Ripple’s lawsuit against SEC on May 21st

TL;DR

The SEC opposes Ripple’s motion to unseal important financial data, arguing that such information is crucial to court decisions. The legal battle between the entities involves allegations of illegal securities offerings by the company, with two sides recently clashing over certain witnesses and awaiting a judge’s decision.

The battle continues

The legal dispute between Ripple and the US Securities and Exchange Commission (SEC) continues to offer further confrontation rather than a final settlement. Most recently, the regulator filed its response to the company’s motion to seal and redact some evidence related to the parties’ briefing on the remedies.

“The Court should deny Ripple’s request to suppress financial and securities sales information because that information constitutes “court documents,” as it is at the heart of the parties’ arguments in support of their motion of appeals and therefore could tend to influence the The decision of judicial appeals”.

It is worth mentioning that the Commission is not challenging the sealing of Ripple’s recent financial statements “as a whole”. He does not oppose the company’s request to seal five exhibits at issue in their entirety and many of their proposed redactions for the purpose of the resource briefings. However, he strongly opposes the company’s request to “redact information about its income and expenses” dating back to 2014.

According to the SEC, this data could shed more light on Ripple’s XRP sales and play a key role in the legal process.

“Ripple wants to hide the extent to which it offered XRP at discriminatory prices. But the period when Ripple offered discounts dates back to 2014 and ended in December 2020. Ripple has not shown how the discounts it offered four years ago and more would matter , especially as Ripple seeks to avoid remedies by claiming it has “changed course.” It is selling XRP and changed its contracts,” the agency added.

The case so far

The lawsuit between the entities began in December 2020 when the SEC accused Ripple and some of its executives of illegally raising more than $1.3 billion in an unregistered securities offering by selling XRP. Over the next few years, the case went through numerous updates before reaching the trial stage on April 23, 2024.

Shortly after that date, Judge Sarah Netburn entered a new scheduling order focused on the appeals motion and entry of final judgment. On April 29, the SEC filed its opposition to Ripple’s motion to strike new expert materials. The motion focused on the testimony of key witness Andrea Fox (known as the “Fox Statement”).

Both entities have faced the issue. The company argued that the statement represents unsolicited expert opinion, while the regulator described it as “standard summary evidence in support of calculations for dumping”.

Earlier this month, Ripple filed a letter in support of its initial request, claiming that the SEC failed to show that the testimony is “summary evidence.”

Both sides filed additional documents and letters in the following days, with U.S. Attorney Jeremy Hogan arguing that they must now await the judge’s decision.

He previously predicted the lawsuit could be officially closed this summer through a $100 million settlement. The potential sum is far less than the $2 billion penalty sought by the SEC and far more than the $10 million Ripple agreed to pay.

If you want to dive into the details of the case and find out how its outcome may affect the price of XRP, check out our dedicated video below:

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