Ripple’s Case Against SEC Boosted As Judge Strikes Down “Hypocrisy” Claim
Another twist is the long-drawn legal tussle between a crypto exchange, Ripple, and the U.S. Securities and Exchange Commission (SEC). Judge Sarah Netburn, the Magistrate attorney, has slammed the agency in what appears to be a win for Ripple.
Ripple Floors SEC Over “Hinman Speech”
The crypto exchange has recorded a massive legal victory over the agency in what is regarded as a “body slam” for Ripple. Accordingly, the magistrate attorney, Sarah Netburn, denied the SEC’s custody request of the documents containing the speech of its former official, William Hinman.
According to an insider’s report of the incident, Hinman is reported to have labeled Ethereum as non-security. As a result, the Magistrate Judge has put the case under wraps and requested that the documents be produced for an in-camera review.
However, the court concluded that the overriding motive of the court session was not to aid the agency’s workings in the general public’s interest. As a result, the commission must produce the document for the courts’ review.
The recent declaration by the U.S. Magistrate court has given Ripple a renewed drive to tackle SEC and bring an end to the legal battle.
How the Case Began
In 2020, Ripple Labs Inc. and two executives were accused of offering unregistered securities to the public. As a result, the SEC sued the crypto exchange and its executives, Brad Garlinghouse and Christian Larsen.
The SEC accused the two individuals of raising more than $1.2 billion in unregistered securities offerings. However, Ripple has consistently defended itself by revealing that its native token XRP is not traded as security.
Both parties have dragged the case for quite some time as the agency believes that Ripple did not play accordion to the rules. The crypto service provider is confident it can follow the case to its logical conclusion, so the battle rages on.
Ripple uses the infamous Hinman Speech to back its argument in the court hearing. The crypto firm cited a speech by the former director of corporate finance, William Hinman, to drive home its point.
According to reports, Hinman is reported to have stated on June 14, 2018, that based on his understanding, Ethereum, along with all its components, is not considered a security.
According to Ripple’s claim, Hinman’s statement contradicts the SEC’s guidelines, which placed XRP as a security asset. However, the regulator has attempted to set aside the speech and prevent Ripple from using it as evidence.
As a result, Ripple asserts that the statement is a personal opinion and does not reflect the wording of the agency.
Alas, the court is not ready to entertain any of this, as Judge Netburn slammed the agency’s resolve to prevent the court from accessing the document. The judge labeled the SEC’s claim as “hypocrisy,” adding that Hinman acted on behalf of the SEC.
Meanwhile, several legal analysts have commended the case’s outcome, which signifies a huge win for Ripple and the crypto industry.
