186 Interactions, 2 today
The defendants have finally filed a response to Attorney John Deaton’s motion to intervene on behalf of XRP holders in the pending dispute between the United States Securities and Exchange Commission and Ripple Labs, which was filed just over two weeks ago.
Back on the 19th of April, when Deaton had first filed the aforementioned motion, the accompanying memorandum of law had argued,
“… XRP Holders cannot rely on the Defendants’ efforts in this case.”
As predicted, Ripple Labs and executives Brad Garlinghouse and Chris Larsen have sided with the intervenors in their current appeal to the motion to interfere, arguing that the “movants should be allowed to participate in the case.” The defendants argued,
“As independent holders, developers, and users of XRP, with no relationship to Defendants, they have strong and distinct interests in the regulatory status of XRP. This Court’s ruling may determine those interests; at minimum, it will affect them.”
Ripple’s claims in favour of such an action are consistent with Deaton’s arguments on the 19th of last month, with the defendants moving on to argue that the effect of the court’s ruling in the current case would be greater than the impact of the SEC’s mere filing of the lawsuit. The latter, according to the blockchain agency, has led to XRP’s valuation and liquidity plummeting rapidly in US markets.
The defendants have agreed with the movers that the SEC’s regulatory authority in this case is founded on “baseless contentions,” adding that, notwithstanding the SEC’s claims to the contrary, the department does not serve the needs of XRP holders. The organisation is attempting to “destroy the market and frustrate the purposes for which the movers hold XRP,” according to the answer.
Finally, Ripple and its executives agreed with Deaton that the defendants should not suit the needs of the intervenors or other XRP holders.
“Defendants’ case will deal not only with the present status of XRP as a security, but also its past status. Movants are focused on the present-day status of XRP – which affects XRP holders’ ability to use it and innovate with it going forward – with little interest in past sales.”
It is worth noting here that the defendants’ approval for the movers’ motion to intervene comes with a stipulation. According to the defendants’ lawyers, they would endorse the movers’ “limited participation” in the case as amici or as intervenors under some limits. They concluded, though,
“Although Movants’ participation in their own names is warranted, the Court should deny Movants’ request to intervene as representatives of a putative class of additional defendants. Intervention on behalf of a class is appropriate only in exceedingly rare cases.”
Such a motion has never been approved by any court in any SEC enforcement action, the defendants concluded.
With both the plaintiffs and the defendants having filed their opposition and response papers, respectively, the movants now have until the 17th of May to file a response to the same.