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A welcome victory was celebrated by Ripple on Thursday in its duel with the Securities and Exchange Commission with the judge ruling that the SEC cannot claim that emails about significant June 2018 speech about Ethereum are considered private documents.
The speech made by SEC official, William Hinman, holds massive weights according to the defendants and has become central to the court case with Ripple fighting off allegations that its native token XRP is a security.
Hinman had told the audience at a Yahoo Finance crypto summit that Ethereum was not a security stating its sufficiently decentralization.
With Hinman’s expressed statements on Ethereum not being a security, the Ripple team makes the comparison to the nature of XRP and to rebuff the SEC’s claims about the token.
On Thursday, additional documents were brought up, such as emails in which Hinman and others discussed a draft of his Ethereum speech. There were also notes included by SEC’s own crypto expert, Valerie Sczepanik.
While the SEC called “privilege” on the documents thereby attempting to shield of the documents in the ongoing lawsuit and exclude the agency, U.S. Magistrate Judge Sarah Netburn decided that this privilege does not apply because Hinman’s words reflected his own views and not those of the agency. The judge said:
“Although Hinman and the SEC admit that agency staff discussed his speech, it appears that this speech was ‘merely peripheral to actual policy formation,’ Tigue, 312 F.3d at 80, and not an ‘essential link’ in the SEC’s deliberative process with respect to Ether, Grand Cent. P’ship, 166 F.3d at 482. Accordingly, emails concerning the speech or draft versions are neither predecisional nor deliberative agency documents entitled to protection.”
Although it can be considered a win for the defense team, Netburn’s decision is largely a procedural one, but it does give Ripple some additional striking power in its fight to show the court that XRP is not a security.