Breaking: Ripple Refutes SEC’s Claims on Historical Contracts and XRP Sales
- Ripple challenges SEC’s reliance on its current financial condition for determining penalties.
- Ripple defends confidentiality of historical contracts and financial information against SEC claims.
Specifically addressing two crucial points in their continuing legal conflict, Ripple Labs has stepped up its case against the US Securities and Exchange Commission (SEC).
A new document made to Judge Analisa Torres of the Southern District of New York details this escalation. While Ripple suggests a $10 million ceiling, the SEC is pushing for penalties that are almost $2 billion.
The New Filing by Ripple
Andrew J. Ceresney of Debevoise & Plimpton LLP wrote a thorough letter to Judge Torres in which Ripple refutes the SEC’s claim that its financial situation at the moment should affect court rulings on past penalties. This information is deemed “important to the Court’s determinations” on remedies related to Ripple’s previous behavior by the SEC in its opposition brief.
#XRPCommunity #SECGov v. #Ripple #XRP @Ripple has filed a reply letter in further support of its Motion to Seal documents in connection with the @SECGov’s Motion for Judgment and Remedies. pic.twitter.com/NeuFZII1m8
— James K. Filan
(@FilanLaw) May 29, 2024
(@FilanLaw) As evaluated years after the purported infractions, Ripple contends that its financial situation has no bearing on the matter.
“Ripple is not arguing that it may be unable to pay any measured penalty,” the defense says, “and there is otherwise no reason to believe that Ripple’s current financial statements (from years after the challenged conduct) are relevant to the Court’s analysis.”
Ripple emphasizes that revealing private financial information is not necessary and that the court can reject the case without taking such information into account. Legal cases such as Tropical Sails Corp. v. Yext, Inc., which acknowledged a “legitimate privacy interest in the financial documents of a privately held company,” support this viewpoint.
Relevance of Historical Contracts
The second main argument tackles the SEC’s assertion that changes in the XRP sales process render Ripple’s past contracts obsolete. Through CFO Jonathan Billich, Ripple contends that although the SEC refers to them as “stale” material, these previous contract terms are nevertheless private and economically sensitive.
According to Billich’s statement, future counterparties may have a lot of power if they could access conditions that were established in earlier agreements.
Ripple stresses that its sales techniques have evolved and that the XRP being sold now does not include any of the terms included in earlier over-the-counter agreements, such as discounts provided to sophisticated counterparties.
XRP Price and Public Disclosure
Furthermore, disproving the SEC’s claims that XRP prices must be made public under securities legislation is Ripple.
Expanding on what was earlier reported by CNF, the court has already ruled that XRP is not a security, even in the event that it were considered an investment contract needing registration. Price terms in historical contracts are therefore different from those that apply to registered securities.
In its argument, Ripple emphasizes the high stakes and how its past contracts and present financial status have no bearing on the SEC’s case.
Showcasing the company’s right to privacy and business sensitivity, Ceresney writes, “Even if the SEC’s arguments were plausible, Ripple has still established a valid, commonly accepted basis for sealing its confidential financial documents.”
Meanwhile, CoinGecko data shows that the price of XRP at the time of writing is at $0.5177, having fallen 2.03% in the last 24 hours and showing a bearish trend with a 2.21% fall over the previous seven days. An earlier CNF report highlights pro-XRP lawyer Bill Morgan charging the SEC of corruption in its case against Ripple.
