The XRP community was furious on September 3 after the United States Securities and Exchange Commission (SEC) filed its opposition to Ripple’s move to force the regulator to produce information on SEC employees’ XRP, Bitcoin and Ether holdings.
On September 7, Onda filed his answer, touching on three of the SEC’s grounds for denial, to further support his own move.
Defense attorney and former federal prosecutor James K. Filan shared a redacted copy of Ripple’s presentation on Twitter.
#XRPCommunity #SECGov v. #Wave #XRP Ripple’s files respond in further support to its Motion to compel the SEC to produce documents showing whether SEC employees were allowed to trade XRP and other digital assets. pic.twitter.com/qR5TEZSMK7
– James K. Filan 🇺🇸🇮🇪 (@FilanLaw) September 7, 2021
A matter of privacy
The SEC had explained that your employees’ business information is collected by an office called an “Ethics Advisor.” According to the agency, the delivery of the “sensitive information” – even in aggregate form – would be an intrusion on the privacy of SEC employees.
In its response, however, Ripple reclaimed The SEC’s opposition “ignores or misrepresents key issues” relevant to the court.
Responding to the SEC’s privacy concerns, the blockchain firm cleared up,
“The defendants seek the production of only aggregated information, completely anonymized, of limited scope and for a limited period of time.”
Furthermore, the defendant also affirmed that there is no Privacy Law that prevents the court from ordering the presentation of the aforementioned information.
Another bone of contention was the SEC claiming that material up to nine years ago might have to be produced. According to its presentation, this “Production charge” it would force the resources of the “Ethics Council”.
Needless to say, Ripple disagreed with the agency, claiming that, to their understanding, the SEC’s XRP records spanned “Just a little over a year.”
In the aforementioned opposition filing, Pascale Guerrier had concluded that the information Ripple seeks is “Simply irrelevant.”
Towards its conclusion, Ripple set,
“There is an obvious tension between the SEC’s general theory in this case – that ‘every offer, sale, and distribution of XRP” by Defendants since 2013 constituted an investment contract and that Individual Defendants recklessly ignored the law – and the fact (which we seek to confirm) that SEC employees themselves were allowed to trade XRP until March 9, 2019, and possibly thereafter. “
In essence, Ripple wants to point out an apparent contradiction. The SEC, according to the firm, theorized that the defendants had violated the law since 2013 by exchanging XRP, while their own employees could have exchanged XRP even after the asset was placed on the Advisor’s “Watch List.” Ethics in April 2018.
The curious case of newsrooms
Particularly surprising was a redacted line from page two of Ripple’s response. Here, Ripple claimed that the SEC’s “Ethics Advisor” had a responsibility to prohibit employees from dealing in securities and digital assets.
Wave He suggested this could have been based on “some assessment of the advisability of SEC staff dealing with these assets” and another censored factor.
However, a note referenced a 2014 “Council of Ethics” guidance document regarding Bitcoin. Although partially redacted, Ripple reclaimed The document shows that the SEC was unsure about the regulation of digital assets even in 2014, while the SEC’s complaint against Ripple included its activities since 2013.
To be sure, various SEC employees and members of the XRP community will follow the case from now on.
This is a machine translation of our English version.