- SEC has been denied access to internal XRP sales documents
- Ripple argued in the court that the documents requested by the SEC are protected by attorney secrecy.
- Once the lawsuit against it is solved, Ripple will go Public soon.
In a significant legal crypto development, Ripple secured yet another victory in its ongoing legal fight against the US securities and exchange commission (SEC) as the court denied the financial markets regulator access to Ripple’s legal communications.
New York Southern District Magistrate Judge Sarah Netburn ruled on Sunday, May 30, to reject the SEC’s petition to force Ripple to produce memos about the sales of XRP with the firm’s lawyers.
At the beginning of May, the US regulator filed a motion seeking access to all communications, transmitting, or discussing any legal advice Ripple sought or received as to whether its sales and offers of its cryptocurrency – XRP were or would be subject to federal securities laws.
In return, Ripple challenged the petition claiming that the SEC’s requested communications are protected by the attorney-client privilege, which has not been put aside. But, the SEC countered saying that Ripple has put its attorney advice at issue by asserting a fair notice defense and that the regulator is entitled to test and rebut this defense.
However, in the latest ruling, Judge Sarah Netburn denied the motion, stating, “encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and administration of justice.”
The judge noted saying although the privilege may be waived in certain circumstances, the lawsuit between Ripple and the SEC is not.
A Win for Ripple
The US regulator dragged Ripple to court in December 2020, accusing the company of selling unregistered securities XRP and raising around $1.3 billion. This turned out to be the biggest crypto-related litigation, given the size and penetration of Ripple. However, over the period, Ripple has managed to gain a series of legal victories, including winning access to internal SEC discussion history regarding cryptocurrencies in April. Additionally, the court also denied the SEC the ability to disclose the financial records of Garlinghouse and Larsen.
Despite the high-profile lawsuit, Ripple is optimistic, and the blockchain company executives are planning to take it public after its settlement with the SEC.