Ripple Vs SEC: Court dismisses SEC’s appeal to protect Hinman’s speech
In the latest development in the SEC Vs Ripple Labs case, the court has dismissed the US Securities Exchange Commission's appeal to protect Hinman’s speech.
Previously, SEC had appealed to the court that William Hinman’s speech, where he had mentioned that Bitcoin and Ether are not securities, to be protected.
Magistrate Judge Sarah Netburn dismissed SEC’s appeal and asked the board to produce documents related to the speech in question.
“This argument was previously raised secondarily, with the SEC primarily asserting the deliberative process privilege. The SEC’s motion is DENIED,” Netburn said.
Judge called SEC’s stance ‘hypocritic’
While appealing to the court, SEC didn’t want the court to take Hinman’s speech seriously, as it was his personal opinion. At the same time, the Exchange Commission wanted to protect the speech from being disclosed.
“The hypocrisy in arguing to the Court, on the one hand, that the Speech is not relevant to the market’s understanding of how or whether the SEC will regulate cryptocurrency, and on the other hand, that Hinman sought and obtained legal advice from SEC counsel in drafting his Speech, suggests that the SEC is adopting its litigation positions to further its desired goal, and not out of a faithful allegiance to the law,” Netburn ruled.
For context, William Hinman, the Director of the Division of Corporate Finance at SEC, said in a 2018 speech that ETH is not a security. He added, that even though ETH conducted an ICO in 2014, it transformed into non-security later.
Ripple Labs have been emphasizing that the XRP coin is not a security, rather, it’s a currency. So Hinman’s speech is a powerful defense for Ripple Labs.
As SEC has accused Ripple of “unlawful offer or sale of securities”, it is clear why they don’t want the speech to be disclosed.
Recently, Brad Garlinghouse, CEO of Ripple, stated that if SEC wins the legal battle, Ripple Labs will leave the United States.
You might be interested in: Ripple Will Leave the US if SEC Wins, Says CEO Garlinghouse
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