- The US SEC had a little win against Ripple yesterday.
- Ripple requested the SEC’s ‘trading policies governing digital assets’.
- The judge denied the Ripple request for documents as it may ‘cause confusion’.
Yesterday, the US Securities and Exchange Commission (SEC) had a little win against Ripple. Judge Sarah Netburn denied the latter’s request for documents detailing the ‘trading policies governing digital assets’.
Based on the ruling provided by Atty. James Filan, the US magistrate judge declined to grant the defendants access to documents. To explain, the judge does not want to ‘cause confusion’ than provide any relevant findings.
Courts have ordered the regulator to disclose its crypto trading policies in the past. Ripple claims the SEC’s counsel advised that their employees are prohibited from trading XRP since the investigation began in 2019.
Ripple maintained that the SEC did not produce any formal documentary evidence supporting their claim. Additionally, Judge Netburn’s analysis in the denied motion summarized the firm’s request as,
Defendants argue that individual trading decisions will, at a minimum, expose the lack of clarity regarding XRP’s status and whether the SEC believed XRP to be a security. Such evidence arguably would undermine the SEC’s allegations that the Individual Defendants acted recklessly and would bolster the Defendants’ fair notice defense.
In addition, Judge Netburn maintained that such arguments don’t seem to be relevant to the case as defendants have not shown such individual trading decisions bear on the issues in the case. Besides, the Privacy Act protects the financial conduct disclosures of SEC employees. Thus, Ripple had yet to prove that suspending such protections would make a material difference to the case.
While the SEC employees’ trading records might be out of bounds for Ripple now, this recent motion reaffirmed that the watchdog must provide documentation that would prove its claims that agency employees were barred from trading XRP in 2019. SEC may have won this round in the war, but it is far from over.