Latest Court’s SEC vs. Ripple Ruling Favours XRP Holders

Latest Court’s SEC vs. Ripple Ruling Favours XRP Holders

In the US Securities and Exchange Commission case against Ripple, Judge Analisa Torres has ruled on petitions made by both sides to exclude expert testimony.

In a tweet today, attorney James K. Filan revealed this information and included a copy of Judge Torres’ decision, who regularly updates the case. 

Significantly, she partially approved and denied motions made by both parties. 

That highlighted the judge’s objectivity, according to the creator and former attorney of Evernode, a Layer 2 network being considered for the XRP Ledger.

Yet, those who own XRP will benefit most from the court’s recent decision. 

Attorney John E. Deaton, who is a friend of the court in the case and is representing over 75,000 XRP holders, emphasized that the federal judge partially granted Ripple’s motion to strike out testimony from the SEC’s Expert No. 1 and struck out the expert’s opinion regarding the perceptions of XRP purchasers.

Deaton further notes that the SEC’s Expert No. 4’s view regarding the dangers to the XRP Ledger if Ripple “disappeared” was also thrown out by the judge.

They are significant because they reveal if XRP holders bought the token to profit entirely from Ripple’s efforts.

As a result, it directly addresses the third and fourth criteria of the Howey Test, thereby undermining the SEC’s argument that all XRP purchases are unregistered securities sales.

XRP Holders Involvements

The founder of CryptoLaw attributed this narrow success to the involvement of XRP holders, affidavits provided by independent developers, and amicus briefs from initiatives like SpendTheBits.

In response to recent events, attorney Jeremy Hogan, a pro-XRP lawyer and partner at Hogan & Hogan, also suggested that the current judgment makes it harder for the SEC to demonstrate that XRP holders had reasonable expectations of gains from Ripple’s efforts.

Therefore, how in the world can the SEC demonstrate reasonable reliance? Who will provide testimony? Hogan tweeted a question in response to the situation.

Hogan pointed out that the judge did not anticipate the opinions of the SEC’s Expert No. 3 on Ripple’s incentives and actions to influence XRP’s price to have a significant impact on the case, even though the judge did maintain that they could be important in determining whether XRP holders had expectations of profits. 

This was defended by a Hogan partner, who called it “weak sauce.”

Eleanor Terrett, a FOX Business reporter who has carefully followed the case, noted that the SEC had previously attempted to remove Deaton from it, partly for disclosing the identity of Expert No. 1. 

But, as Terrett noted, Judge Torres decided that this expert could not speak on the intents of XRP holders rather than disqualifying Deaton from the discussion.

What Does This Mean for Ripple?

Judge Torres’ decision on the Omnibus motions is anticipated after she has decided on the Daubert motions. 

This outcome will be of great importance to the XRP community because it will determine whether or not the public can finally view the contentious Hinman documents.

Regarding developing the controversial Bill Hinman speech in 2018, the Hinman documents refer to emails and other documents.

At the time, Hinman, an SEC director, said that Ethereum and Bitcoin were not securities. The XRP community has questioned the speaker’s motivation. 

The SEC’s decision to pursue XRP after handing Ethereum what some community members call a “free pass” has also drawn attention.

Remember that the SEC had requested that the materials be kept sealed in its Omnibus motions; in response, Ripple argued against this position.

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Disclaimer: The information in this article should not be considered financial advice, and FXCryptoNews articles are intended only to provide educational and general information. Please consult with a financial advisor before making any investment decisions.

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