The U.S. Securities and Exchange Commission (SEC) and Ripple Labs jointly want a federal judge to rule that the XRP-linked company violated federal securities laws or dismiss the case without requiring a lengthy hearing.
SEC and Ripple Request Judge to Decide
The SEC and XRP filed petitions for summary judgment in the Southern District of New York, asking District Judge Analisa Torres to make a decision based on the arguments presented in the accompanying documents.
The documents were published in a federal court database on Friday.
The SEC sued Ripple Labs, CEO Brad Garlinghouse and Chairman Chris Larsen for allegedly raising more than $1.3 billion by selling XRP in unregistered securities transactions in December 2020 (a day before former SEC Chairman Jay Clayton stepped down).
The company argued that XRP sales and trading did not meet the principles of the Howey Test, which is used as a way to determine whether an asset is a security.
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Together with the Summary Decision Requests, the Parties Stated that They Wanted a Decision
A summary judgment request means that the parties are asking the court to decide whether the SEC or Ripple has provided sufficient evidence to prove whether there has been a violation.
#XRPCommunity #SECGov v. #Ripple #XRP BREAKING: Ripple Labs, Brad Garlinghouse and Chris Larsen file Motion for Summary Judgment seeking judgment as a matter of law.https://t.co/1BG1MgQu7p
— James K. Filan
112k (beware of imposters) (@FilanLaw) September 17, 2022
Among other things, the SEC says that various statements from Ripple executives indicate that Ripple is selling XRP and that XRP investors are cryptocurrencyargued that it showed that they bought with the belief that their assets would gain in value over time.
“Ripple has publicly announced the various steps it has taken and will take to find an “application” for XRP and maintain the integrity and liquidity of the XRP markets,” the SEC filing said.
One of the company’s arguments was that there is no contract between the company and XRP investors, and it is not a joint venture, which is one of the requirements under Howey.
In the company’s application, it was stated that many people who buy XRP through exchanges will not know from whom they purchased the tokens.
The following statements were included in the company’s application:
“Even if the SEC conducts a delayed, post-discovery-based review to determine XRP offerings and sales by contracts, its claim would still be void as a matter of law. None of these agreements gave buyers any post-sale rights to XRP or imposed any post-sale obligations on the company to act in the interests of those buyers.”
*Not investment advice.