Bradley Sostack, the lead plaintiff in the class-action lawsuit investors filed against Ripple, is now calling on Ripple to conduct all email communications with the SEC regarding XRP. The motion filed by the lead plaintiff’s attorney forced Ripple to create “improperly withheld email communications and document retention policies.”
Ripple Legal Troubles
The lawsuit, filed in the summer of 2018, accused Ripple and its CEO Brad Garlinghouse of violating U.S. securities laws by selling XRP to the public and pledging to increase the value of the tokens.
Interestingly, the SEC’s lawsuit against Ripple in December 2020 brought similar allegations, and each case has raised concerns about XRP’s classification as collateral.
In the Sostack case, the plaintiff now argues that Ripple’s communications with the SEC during the agency’s investigation were clearly tied to claims and defenses that arose from their own litigation.
Ripple reportedly acknowledged this to some extent and sent official letters shared between them and the SEC. However, Ripple refused to share its email exchanges with the SEC, including documents that Ripple claimed were related to “settlement discussions with the SEC.”
The Sostack plaintiff also argued that Ripple retained and deleted “thousands” of documents due to privilege or other undisclosed reasons.
Ripple refuse the notion that XRP is a security
The U.S. District Court of Northern California will hear the motion on March 25th. In the past, Brad Garlinghouse, CEO of Ripple, was often quick to disprove the notion that XRP can be viewed as a security.
“I think it’s very clear that XRP is not a security. It exists independently of Ripple, the company. If Ripple shut down tomorrow, the XRP ecosystem would continue to exist.” At the same time, the price of XRP has consolidated since the lawsuit was announced. It is currently trading at the $0.50 level at the time of writing.