As a researcher with experience in following the developments of cryptocurrency regulations and legal cases, I find the SEC’s move to bring up the Ripple class action lawsuit as supplemental authority in the Binance case intriguing. The differing opinions on XRP‘s security status between two district court judges adds complexity to this issue.
The SEC highlights the contrasting outcomes in two related cases: the ongoing Ripple class action and the Binance lawsuit. In the Ripple case, a California district court judge’s ruling on the XRP tokens differs significantly from the earlier determination made by a judge in the Southern District of New York that XRP is not considered a security.
SEC Files Ripple Lawsuit As Supplement Authority in Binance Suit
As a researcher examining recent developments in securities law, I’d like to bring your attention to an important update in a ongoing legal case. In a new filing with the U.S. District Court of Columbia, the Securities and Exchange Commission (SEC) has presented the Ripple class action lawsuit as additional relevant authority for the court’s consideration in its proceedings against Binance, Binance.US, and their former CEO, Changpeng Zhao. The SEC believes that the legal arguments and the judge’s opinion in the Ripple case hold significance for the ongoing litigation.
The Binance lawsuit is approaching the final stages of the discovery process, with most disputes over evidence having been resolved. Currently, the involved parties are waiting for the court’s decision on various motions, one of which is a mutually filed request to dismiss the case.
In the case of In re Ripple Labs, Inc. Litigation, Judge Hamilton decided in favor of Ripple, discarding most claims made by the plaintiff concerning securities violations. Nonetheless, a trial regarding allegedly misleading statements from Ripple CEO Brad Garlinghouse regarding XRP sales will still proceed.
In a recent post addressing misleading claims in the ongoing case, Ripple CEO Garlinghouse asserted his commitment to the truth, expressing eagerness to clarify matters during the trial. He further pointed out that the sole accusing party, who owns a modest amount of XRP, didn’t acquire it directly from Ripple and therefore couldn’t confirm if they had heard the statement prior to trading.
SEC Spotlights Judge Hamilton’s Opinion on XRP Security Status
Expert: Judge Hamilton overruled the decision made by the SDNY court regarding the non-securities status of XRP‘s programmatic sales, sparking controversy within the XRP community. The judge assessing the third prong of the Howey test stated that ” buyers engaging in programmatic transactions may have purchased XRP with the hope of earning profits from Ripple’s endeavors.”
The SEC also seeks the court’s attention towards Ripple CEO’s misleading statements regarding XRP. The biggest concern for Ripple is the SEC using this California case in the Second Circuit in its appeal against Judge Torres’ summary judgment on XRP. But for that, the court must first decide whether XRP sales were securities.
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2024-06-22 10:53