August 31, 2021

Court upholds Ripple on SEC document disclosures

Magistrate Judge Sarah Netburn ruled that the U.S. Securities and Exchange Commission (SEC) must provide Ripple's requested documents for a "closed-door" review . This was reported by attorney James Phelan.

At the August 31 hearing, which was held via teleconference, the parties discussed the SEC's deliberative process privilege. It is a principle of law that allows the regulator to refuse to disclose documents or testify, citing confidentiality of data and sources.

Netburn said Ripple has made a strong case for its request, and therefore needs to review the documents to determine whether they should be protected from disclosure.

The term review in camera, which Netburn used, means that defendants will not be able to review the data provided by the SEC at this stage. If the judge deems them important to the process, they will be disclosed in open court.

A Commission spokeswoman tried to challenge the judge, claiming "special treatment for defendants" and setting a "dangerous" precedent for the regulator, but Netburn rejected those arguments She said Ripple would not receive privilege because the company's lawyers would not see the documents until she decides otherwise.

Netburn has until Sept. 28 to review the SEC's information, after which she will rule on whether its concealment is justified. The regulator is ordered to file the documents with as few edits as possible.

The meeting did not address the issue of the SEC granting access to Ripple employees' correspondence on the Slack messenger.

Earlier, William Hinman, the SEC's former director of corporate finance, said that he had warned Ripple about the risk of recognizing XRP as a security.

Jack Evans

About the author

I became a crypto asset owner in 2014, when the industry was in its infancy. Before that, I was working in the classic US and European stock markets. Since then, I have gained extensive experience in both cryptocurrency investing and day trading. I am happy to share with readers my experience with crypto exchanges, DeFi and NFT instruments. 

View All Posts By Jack Evans