A federal judge has ruled in favor of the U.S. Securities and Exchange Commission (SEC) and ordered Ripple to comply with the regulator’s post-complaint discovery requests concerning XRP. Ripple must also answer an interrogatory regarding the amount of XRP institutional sales proceeds it received after the SEC complaint was filed.
Judge Grants SEC’s Motion Against Ripple
On Monday, U.S. Magistrate Judge Sarah Netburn ruled in favor of the U.S. Securities and Exchange Commission (SEC) against Ripple Labs concerning XRP.
The securities regulator seeks an order compelling Ripple to produce “2022-2023 financial statements” and “post-complaint contracts governing ‘institutional sales.’” The SEC also wants the crypto firm to “answer an interrogatory regarding the amount of XRP institutional sales proceeds it received after the complaint was filed,” Monday’s court document details, adding:
The SEC’s motion is granted in full.
The court also addressed Ripple’s objections to the SEC’s motion. The crypto firm had argued that the securities watchdog’s requests are “untimely,” asserting that the agency “has failed to justify each of its requests on the merits.” Ripple also claimed that “the information the SEC seeks has no bearing on the court’s remedies determination.”
Regarding Ripple’s financial statements, the court document explains that “At this stage, the Court sees no basis to short-circuit that inquiry by denying access to readily available information that may be probative to the remedy stage.”
As for the post-complaint contracts, “The Court is not convinced that the production of these contracts will result in an improper or costly ‘mini-trial,’” as warned by Ripple. Regarding post-complaint XRP institutional sales proceeds, the judge ruled that “the SEC has made a sufficient showing that this information may assist the Court in fashioning its remedy,” noting that “Ripple must respond to the interrogatory.” The Court has set Feb. 12 as the deadline to complete the “remedies-related discovery.”
What do you think about the federal judge ordering Ripple to comply with the SEC’s requests concerning XRP? Let us know in the comments section below.