The court’s decision to order the publication of the documents written by former SEC Corporation Finance Division Director William Hinman on September 29 gave Ripple Labs a victory in its ongoing legal dispute with the SEC.
The United States Securities and Exchange Commission (SEC) was unsuccessful in its second attempt to withhold the documents pertaining to former Division Director William Hinman, according to U.S. District Court Judge Analisa Torres.
Ether (ETH), according to Hinman, is not a security. Though it’s too soon to know whether the terminology used in the speech will have the same impact as the firm claims, Ripple Labs considers it as a key piece of evidence in the action the SEC has launched against it, alleging that sales of Ripple’s XRP violated U.S. securities laws.
There is a great deal of uncertainty regarding the speech’s context and Hinman’s actions prior to it. The majority of the documents concern a speech Hinman gave in June 2018 at the Yahoo Finance All Markets Summit.
Judge Sarah Netburn of the District Court decided that the emails and speech drafts were not shielded by the deliberative process privilege, as the SEC had argued, and Judge Torres’ judgment rejected the SEC’s objections to the documents’ release.
The materials were subsequently subject to the SEC’s assertion of attorney-client privilege, which was rejected by Netburn in July. The SEC’s challenges to Judge Torres’ judgment were dismissed.
The SEC sued Ripple Labs, its current CEO Brad Garlinghouse, and its former CEO Chris Larsen in December 2020, asserting that the company’s cryptocurrency, XRP, is a security because it was used to raise money in 2013. The case is a somewhat uncommon illustration of an SEC lawsuit that proceeds to trial, possibly setting a precedent rather than concluding in a settlement.
Ripple has pursued a number of defensive tactics after the business initially believed the case was going against it. Ripple Labs and the SEC submitted motions for summary judgment in the U.S. District Court for the Southern District of New York on September 17.