Ripple Labs has reportedly received discovery from the US Securities and Exchange Commission (SEC). The court ordered the commission to produce internal documents on its discussion of whether XRP tokens are similar to bitcoin and ether, which are not currently classified as securities.
Shakeout wins SEC discovery and gains access to the commission’s internalcryptographic files.
A conference call was held on Tuesday to announce the action against Ripple Labs by the US Securities and Exchange Commission. Ripple Labs has reportedly received an injunction from the Securities and Exchange Commission.
U.S. District Judge Sarah Netburn said: I grant the majority of Defendant’s motion, noting that discovery was successful. It then asked the U.S. Securities and Exchange Commission to hold internal discussions to determine whether XRP tokens are similar to cryptocurrencies such as Bitcoin (BTC) and Ether (ETH), which are not currently regulated as securities.
The judge stated that email communication between employees was not required. However, it is likely that other documents, such as Securities and Exchange Commission (SEC) minutes and memos expressing the agency’s interpretation or view of cryptocurrencies, will be discovered.
Last December, the Commission filed a lawsuit against Ripple Labs, its CEO, Brad Garlinghouse, and co-founder, Christian Larsen, for allegedly selling $1.38 billion worth of XRP tokens without complying with federal securities laws. The case is also under the supervision of US District Judge Analisa Torres.
Ripple and its executives argue that one of the reasons the Securities and Exchange Commission did not take enforcement action against XRP for eight years was because the commission did not know whether XRP was more similar to bitcoin and ether, which are not considered securities, or to other cryptocurrencies and tokens, which are classified as securities.
Matthew Solomon, of Garlinghouse City Council, said before Tuesday’s decision: We need this discovery to protect us. He said if the defendants find evidence that the SEC believes XRP is related to Bitcoin or Ether, it could be game over for the entire lawsuit.
How about the court’s decision in favor of Ripple v. SEC? Let us know your comments in the section below.
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