Ripple Labs is pushing back against the SEC's demands for hefty penalties in their legal dispute, arguing that both its current financial status and historical contracts should not play a role in determining penalties.
In a letter to Judge Analisa Torres, Andrew J. Ceresney from Debevoise & Plimpton LLP, representing Ripple, contests the SEC's insistence on considering Ripple's present financial condition when assessing penalties for past violations. Ripple contends that its financial status, evaluated years after the alleged infractions, should not influence the court's decision.
The defense emphasizes that disclosing recent financial statements is unnecessary and cites legal precedents supporting the privacy of such documents for private companies.
Another area of contention is the relevance of Ripple's historical contracts, which the SEC deems outdated due to changes in XRP sales methods. Ripple maintains that these past contract terms remain confidential and commercially sensitive, arguing that revealing them could provide unfair advantages to future counterparties. The company highlights the evolution of its sales practices, noting that current XRP sales do not involve the same conditions as before, such as discounts for sophisticated buyers.
Additionally, Ripple disputes the SEC's claim that public disclosure of XRP prices is necessary under securities law, given that the court has ruled XRP not to be a security. The defense asserts that historical contract prices are irrelevant to registered securities. Ripple's defense underscores its right to privacy by sealing confidential financial documents.
As the case progresses, the decision regarding Andrea Fox's role as either a summary or expert witness, to be determined by Magistrate Judge Sarah Netburn, is awaited before Judge Torres can rule on the remedies phase.
Ripple's comprehensive defense aims to protect its financial privacy and the confidentiality of past contracts, while also seeking to minimize penalties and safeguard its business interests. The outcome of this case will have significant implications for the cryptocurrency industry and the regulation of digital assets.
May 2024, Cryptoniteuae