73 Interactions, 2 Today
In the most recent step in the legal struggle between the United States Securities and Exchange Commission and Ripple Labs, the former appears to have won a modest victory.
Ripple has been asked by Judge Sarah Netburn to disclose additional Slack messages from a larger range of custodians. Previously, the SEC had filed a petition requesting that Ripple workers provide up their Slack discussions. Since Ripple employees frequently talked via Slack, the SEC estimates that there are over a million communications to be analysed.
While the SEC stated that the defendants agreed to submit this information at the start of the discovery phase, they later referred to it as a “extensive and costly fishing expedition” that would consume a considerable amount of time and resources.
Because Ripple found this information “neither critical nor uniquely relevant,” the regulatory body had previously demanded an emergency conference on the matter. However, Judge Netburn felt no need for the same and issued the recent order as text-only.
According to the text, Ripple now has to produce Slack messages from 22 custodians listed out by the SEC. The order further ruled that Slack messages are relevant to both the parties and Ripple’s perceived burden is outweighed by its previous agreement to produce the same. It further read,
“The Slack messages sought are relevant to the parties’ claims and defenses and proportional to the needs of the case. 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.”
Ripple has claimed that producing gigabytes of data relevant to the Slack messages would be a “undue burden.” In response to the SEC’s request for a pre-motion conference, this was done. Similarly, the agency stated that Ripple’s denial stems from its own “mistakes in acquiring that data.” A few Slack communications, on the other hand, provided the commision with “critically significant information.”
During a conference call on August 31 about the SEC’s privilege issue, the judge also ordered the regulatory watchdog to submit internal records relating debates about the nature of XRP and ETH, which she will evaluate in private.
Many in the crypto-community have pointed out that this demonstrates Judge Netburn’s impartiality. Others have speculated that this revelation would be insignificant because anything the employees might have said would be judged immaterial regardless of whether they were aware of XRP being a security or not.
In another case-related development, Judge Netburn dismissed the Chamber of Digital Commerce’s counsel’s application to appear as a ‘amicus curiae,’ or ‘friend of the court.’ According to the in-text ruling, because “the attorney did not represent a movant or party in the case,” the motion was withdrawn from the case docket.
What does it mean to us laymen people please
— markpywell (@mark_pywell) September 1, 2021
The counsel for the Chamber filed a motion to appear in the case as a friend of the court, but Judge Netburn has her own local rules to be followed, starting with a Motion for Leave. This was not a rejection on merits, only on procedure.
— CryptoLaw (@CryptoLawUS) September 1, 2021