Ripple Vs SEC: Lawyer Calls Out Mistakes In Brad Garlinghouse & Chris Larsen’s Deal

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As a seasoned crypto investor with over two decades of experience navigating the ever-evolving landscape of digital assets, I find myself intrigued by the recent developments in the Ripple vs SEC case. Fred Rispoli’s criticisms towards Brad Garlinghouse and Chris Larsen’s decision to settle partially rather than pursuing a full trial have piqued my interest.

Lawyer Fred Rispoli, involved in the Ripple vs SEC case, has voiced his criticism towards Brad Garlinghouse and Chris Larsen, as they opted to drop certain accusations made by the U.S. Securities and Exchange Commission (SEC), rather than aiming for a complete dismissal of all charges against them. Rispoli suggests that these executives might have been better off pursuing the elimination of all charges instead of reaching a settlement with only some parts being dropped.

Fred Rispoli Criticizes Brad Garlinghouse and Chris Larsen’s Deal

Via multiple posts on the X platform, attorney Fred Rispoli highlighted what he referred to as errors in the legal strategy employed by Garlinghouse (Ripple’s CEO) and Larsen (Ripple’s executive chairman).

He privately voiced worry about their choice to abandon certain allegations, opting instead for a settlement rather than facing a full trial regarding the “aiding and abetting” accusations brought forth by the U.S. Securities and Exchange Commission (SEC).

According to Rispoli’s perspective, Ripple’s top executives had the strongest argument to counter the Securities and Exchange Commission’s accusations, particularly the charge related to “Institutional Sales.” This claim would only stand if there was proof of recklessness, but Rispoli believes the agency failed to provide convincing evidence to support this claim. He suggested that a jury might find the SEC’s case unsatisfactory, potentially leading to a decision in favor of Garlinghouse and Larsen by a unanimous vote.

Missed Opportunities for Key Testimonies in Ripple vs SEC Case

Additionally, Rispoli mentioned that if Ripple’s CEO Brad Garlinghouse and Larsen had gone to trial, it was plausible that additional witnesses could come into play. He explained that potential witnesses could include Jay Clayton, the SEC’s former chairman, Bill Hinman, the former co-director of the corporation finance division, as well as other significant figures within the industry, who might have been summoned to testify.

The testimonies provided during the Ripple vs SEC trial might have hinted at the Securities and Exchange Commission’s internal decisions regarding the categorization of cryptocurrencies, particularly XRP.

Moreover, conducting a trial would provide an opportunity to reveal certain documents that had hitherto been protected from disclosure. Rispoli suggested that this could potentially benefit Ripple and other digital currency firms by providing valuable precedents for future legal disputes with the U.S. Securities and Exchange Commission (SEC).

Ripple’s Cross-Appeal and the SEC’s Latest Move

Responding to the SEC’s continuous efforts to challenge certain parts of a 2023 court judgment made by U.S. District Judge Analisa Torres, Ripple Labs countered with a cross-appeal. In her ruling, Judge Torres determined that Ripple’s sales of XRP to retail buyers on digital platforms were not considered securities transactions.

Instead, it’s worth noting that the regulatory body has decided to challenge other aspects of the ruling in the Ripple vs SEC lawsuit. These aspects include Ripple’s institutional sales and the distribution of XRP in exchange for non-cash assets.

Stuart Alderoty, Ripple’s legal head, expressed confidence regarding their case, suggesting that they had a strong chance in the Southern District of New York and an even stronger one in the Second Circuit. He made these comments during a recent interview.

US SEC’s Filing Deadline and Response

A debate has emerged over whether the Securities and Exchange Commission (SEC) met the deadline for filing their appeal brief in the Ripple case. Some users of X claim that the agency missed the 14-day window for submitting the Form C, as the form was filed on October 16, but it appeared on the Second Circuit’s docket as having been submitted a day later on October 17, casting doubt on the legitimacy of the filing.

In reply to my query regarding the issue with the filing deadline and the inconsistency between the date on the Form C and the timestamp, a representative from the Securities and Exchange Commission (SEC) provided me with this information: The SEC explained that…

“It was filed on time.”

Listening to @MetaLawMan on @AbsGMCrypto this morning, he said…

— Eleanor Terrett (@EleanorTerrett) October 18, 2024

When inquired about the submission’s due date, the US SEC representative responded, “It was submitted on schedule.” Notably, despite this, the US SEC’s appeal does not dispute the section of the ruling that declares sales of XRP to individual investors via exchanges are not considered securities. This particular decision remains unchanged, preserving the court’s determination that XRP is not a security when sold to retail investors.

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2024-10-19 05:04