The judge mentioned attorney-client privilege as a point for denying the SEC access to the legal records of Ripple.
The motion filed by the US Securities and Exchange Commission (SEC) to access Ripple Labs‘ legal concerns about XRP has been denied. Now, the SEC will be unable to get access to Ripple Lab’s legal records on the status of XRP as a security.
Earlier this month, the SEC asked the court to order Ripple Labs to submit every legal document showing whether XRP sales are compliant with the federal securities law. The SEC filed the request with United States Magistrate Judge Sarah Netburn on the 7th of May.
SEC and Ripple Labs Case
Judge Netburn denied SEC access to Ripple Labs’ legal communication on the 30th of May. According to a memo from the US District Court, the SEC has been looking to access “all communications constituting, transmitting, or discussing any legal advice Ripple sought or received as to whether its offers and sales of XRP were or would be subject to federal securities laws.”
Judge Netburn noted some reasons behind the decision to deny the SEC access to Ripple Labs’ legal documents. The judge mentioned attorney-client privilege as a point for denying the SEC access to the legal concerns. She stated in the filing:
“Ripple asserts that the SEC’s requested communications are protected by the attorney-client privilege, which has not been waived.”
Judge Netburn noted that attorney-client privilege lessens the right to relevant information. She continued that the right should be confined within the most possible limit.
Ripple Says No Clarity on Obligations under the Law
In addition, Ripple Labs said that there was no clarity and fair notice concerning its obligations under the law. Speaking further, Ripple Labs also mentioned that the SEC tarried for years before filing the lawsuit. Notably, the SEC filed the initial lawsuit about 8 years after Ripple has seen more than 200 listings. Over the same period, Ripple has recorded billions of dollars in sales of XRP.
A partner at Hogan & Hogan, Jeremy Hogan, who has also been following the SEC/Ripple legal battle, talked about the court ruling. He said:
“Very important because the Judge states Ripple’s subjective beliefs re XRP are NOT relevant to the Fair Notice defense, blocking the road the SEC wanted to use to fight the Defense.”
Following SEC’s motion, Ripple Labs has also filed a motion. Ripple Labs requested that Judge Netburn order the SEC to reveal internal memos about digital currencies. Ripple’s lawyers are of the opinion that the memos may help determine if the SEC was prejudiced against XRP.
Ripple has been facing lawsuits from the SEC over time, fueling the volatility in the price of XRP. Despite the prolonged legal battle, Ripple Labs CEO Brad Garlinghouse is positive that the company will go public sometime in the future when the case with SEC concludes.
Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.