The defendants benefit from the latest developments in the legal battle between Ripple and the SEC. Brad Garlinghouse’s application to obtain international discoveries, namely the Binance Document from the Cayman Islands, was approved by the court.
Ripple CEO to Obtain the Binance Document
Recently, Garlinghouse’s lawyer applied to the court to obtain the Binance Document from Cayman Island under the Hague Convention of March 18, 1970, for evidence on foreign civil or commercial matters.
The letter assumes that the documents requested are “related to the case and cannot be obtained in any other way”. In addition, the defense argued that the following content “contains unique documents and information,” particularly in relation to the XRP lawsuit.
How Important Is the Binance Document to Ripple?
Defendant’s lawyer detailed in its motion to seek defense that these documents will prove, under Article 5 of the Securities Act of 1933, that the SEC’s lawsuit against Ripple’s XRP sales is invalid.
According to the US Securities and Exchange Commission, Garlinghouse sold 357 million XRP units to investors “around the world” on a “global” digital asset trading platform like Binance in violation of Section 5 of the Securities Act of 1933. The law applies but only for domestic sales and offers of securities, which contradicts global violations alleged by the SEC. As a result, the SEC can only bill Ripple for its services in the US, and according to the SEC, most of the “overwhelming” sales are overseas.
The letter stated:
“As the SEC knows, Mr Garlinghouse’s sales of XRP were overwhelmingly made on digital asset trading platforms outside of the United States […] the discovery that Mr Garlinghouse seeks will be relevant to demonstrating that the offers and sales that the SEC challenges did not occur in this country and are not subject to the law that the SEC has invoked in this case.”
The Binance document as evidence invalidating the SEC’s claims under Section 5 may win the defendant’s motion to dismiss. In the letter, the defense stressed that these documents can be used as a reason for their rejection motion and that most sales and sales are outside of the United States.