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SEC vs Ripple: Judge Torres unseals three documents, here’s what it means

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04
Feb

Attorney Jeremy Hogan took to Twitter to comment that,

“The next couple months will be very interesting with all the major rulings that are being teed up!”

The Ripple-SEC lawsuit is indeed at a crucial juncture. After Judge Netburn granted SEC’s request for an extension for DPP reconsideration, all eyes are now on 17 February as the deadline approaches. After which, Ripple faces a deadline of 25 February to respond to SEC’s motion for reconsideration. The end of this month will be the deadline for Expert Discovery as per lawyer James Filan.

Meanwhile, in the latest, Judge Torres has ordered to unseal three documents. These pertain to the Notice of Brad Garlinghouse’s Deposition in the SEC formal investigation, a Chris Larsen Email String, and a Brad Garlinghouse Email, Filan noted.

John Deaton’s CryptoLaw portal explained that one of the documents in question is an email to Larsen and legal memos to Ripple, finding arguments to seal “unjustified” but granted redactions to Garlinghouse to protect “potentially sensitive information” in three documents. Further adding,

“She also ordered public release of docs filed by both sides under seal anticipating motions to seal from other side that never came. Lastly, Torres will allow Ripple a sur-reply to @SECGov’s Memorandum of Law in support of Motion to Strike fair notice defense.”

Under the same fair notice defense in the SEC v. Keener case, the court had earlier ruled that Keener’s Fair Notice Defense did not hold, stating that the defendant did not identify as a securities “dealer”. “In rejecting the “fair notice” defense “as a matter of law” and awarding the SEC summary judgment, Keener held that the

“Defendant had notice that his conduct could be unlawful based upon ‘the express language of the Exchange Act, decisions from this circuit applying the definition of “dealer,” and [SEC guidance] itself.”

Having said that, John Deaton, the lawyer who represented XRP holders in the lawsuit, believes that the ruling is favorable as,

“What these rulings clearly show is that Judge Torres favors public disclosure. Ripple can’t seal certain documents (ie legal Memo ). The same applies to the SEC. “

With regard to the ongoing uncertainty, Securities and Exchange Commissioner Hester Peirce had told Yahoo Finance that it’s time SEC laid down a clear framework. She noted that the regulator should ‘not lead with enforcement, but with a regulatory hand to help people navigate this very difficult territory,’

“It gets a little more difficult because the token works in a different way than some of these other assets do, and the information that you might want about that token is a little bit different than you might want about other kinds of assets.”

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