US SEC Responds to Ripple’s Opposition
In its response to Ripple’s opposition, the US Securities and Exchange Commission (SEC) argues that its requests for audited financial statements, post-complaint contracts, and details on XRP sales are procedurally proper and not untimely. The SEC states that post-complaint facts are relevant in remedies for securities law violations. It also emphasizes that it is seeking penalties from Ripple to send a strong message about taking securities violations seriously, rather than determining the legality of post-complaint sales.
SEC Seeks Evidence of Ripple’s Intentions
The SEC asserts that it needs post-sale and post-summary decision contracts to test Ripple’s intentions regarding future sales and whether they can be structured in a compliant way. This evidence would help determine if it is commercially viable for Ripple to structure sales in a way that falls outside the scope of institutional sales. Pro-XRP attorney Bill Morgan believes that discovery will be ordered for these post-complaint contracts.
Declaration by Carolyn Dicharry Submitted
In response to Ripple’s claim that the SEC lacked good cause for further discovery, the SEC submits a declaration by Carolyn Dicharry, a former consultant for Ripple. Dicharry testifies that Ripple entered into XRP direct sales contracts with 23 specific counterparties between July 2017 and April 2020. She also states that most XRP sales between May 2020 and June 2023 were ODL transactions sourced directly from Ripple, while some XRP was sold on digital asset exchanges via market-makers to unknown purchasers.
Hot Take: SEC Pushes for Strong Remedies in Ripple Lawsuit
The latest response from the SEC in the ongoing lawsuit against Ripple indicates its determination to seek penalties and send a message about securities violations. By arguing for the relevance of post-complaint facts and requesting evidence of Ripple’s intentions, the SEC aims to obtain an injunction that could impact Ripple’s ODL business. With discovery likely to be ordered for post-complaint contracts, the outcome of this case could have significant implications for Ripple and the broader crypto industry.
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