U.S. Magistrate Judge Sarah Netburn ordered Ripple to hand over more than 1 million internal Slack messages from employees, which is another discovery win for the U.S. Securities and Exchange Commission.
Ripple Previously Shared Small Fraction of Their Slack Messages
The decision was made after the financial market regulators filed an application for this information to be obtained at the beginning of August. The size of these messages is given in “terabytes”.
Although Ripple previously agreed to share these earlier notices with law enforcement agencies, it ultimately only shared a small fraction of them. Then the blockchain company stated that it was unable to get all of the messages due to some processing errors.
However, the US Securities and Exchange Commission stressed the importance of this information in the lawsuit against Ripple, stating that the company’s refusal to provide most of the documents was “very biased.”
“These messages include (a) discussions about Ripple’s desire to create speculative trading in XRP, (b) the effect of Ripple announcements and efforts on, and Ripple’s concerns as to, the price of XRP, the relationship and central importance of XRP sales to Ripple’s overall business, and (d) the regulatory status of XRP,” SEC said.
In addition to the Slack newsletter, the regulatory authority also seeks all information from 22 e-mail custodians.
Ripple Claims SEC Requirements were Unfair and Unreasonable
In response to the SEC’s actions, Ripple argued that it would take up to $1 million and several months to restore all Slack messages, stating that the regulator’s requirements were unfair and unreasonable.
However, Judge Netburn pointed out the importance of this case and Ripple’s earlier promise to share all information and ordered support for the financial market regulators.
“Any burden to Ripple is outweighed by its previous agreement to produce the relevant Slack messages, the relative resources of the parties, and the amount in controversy,” said Judge Netburn.