Ripple XRP News : US SEC Cites Ripple XRP Case in Legal Action Against Binance
Crypto News – The U.S. Securities and Exchange Commission (SEC) has brought recent developments from the Ripple class action lawsuit to the forefront in its ongoing legal battle against Binance. A recent ruling by a California district court judge in the Ripple case significantly diverges from an earlier decision by a Southern District of New York (SDNY) judge, creating a complex legal landscape.
SEC Files Ripple Lawsuit as Supplemental Authority in Binance Case
In its latest filing in the District Court of Columbia, the SEC has submitted the Ripple class action lawsuit as supplemental authority. The securities regulator argues that the judge’s opinion in the Ripple case is pertinent to its lawsuit against Binance, Binance.US, and former CEO Changpeng Zhao. The SEC believes that the arguments and judicial opinions from the Ripple lawsuit could influence the court’s decision in the Binance case.
Discovery Phase Nears Completion in Binance Lawsuit
The Binance lawsuit is approaching the end of its discovery and deposition phase, with most discovery disputes resolved between the parties. The case is currently awaiting the court’s ruling on several motions, including a joint motion to dismiss the lawsuit.
Judge Hamilton’s Ruling in Ripple Case
In the Ripple Labs litigation, Judge Hamilton ruled largely in favor of Ripple, dismissing most of the plaintiff’s arguments regarding securities violations. However, a trial will still be held concerning allegations of misleading statements made by Ripple CEO Brad Garlinghouse about XRP sales. Garlinghouse has publicly stated his confidence in addressing these allegations during the trial, noting that the plaintiff did not purchase XRP directly from Ripple and may not have heard the statements in question before trading.
Debate Over XRP’s Security Status
Judge Hamilton’s ruling diverges from the SDNY court’s decision that XRP programmatic sales are not securities. This discrepancy has sparked debate within the XRP community. Judge Hamilton’s interpretation of the third prong of the Howey test suggested that “programmatic buyers may have purchased XRP with the expectation of profits derived from Ripple’s efforts.”
Ripple CEO’s Misleading Statements in Focus
The SEC is also highlighting alleged misleading statements made by Ripple’s CEO regarding XRP. Ripple’s primary concern is the potential use of the California case in the Second Circuit as part of the SEC’s appeal against Judge Torres’ summary judgment on XRP. The court must first determine whether XRP sales constituted securities.
The ongoing legal battles underscore the complexity of defining and regulating digital assets, with significant implications for the cryptocurrency industry.
FAQ on SEC’s Use of Ripple Case in Binance Lawsuit
Why is the SEC referencing the Ripple case in its lawsuit against Binance?
The SEC is using the Ripple case as supplemental authority in its lawsuit against Binance because it believes the arguments and judicial opinions from the Ripple case are relevant to the issues at hand in the Binance lawsuit. By citing the Ripple ruling, the SEC aims to strengthen its position and potentially influence the court’s decision in the Binance case.
What is the main difference between the California and SDNY rulings on XRP?
The primary difference is that the California judge ruled that XRP could be considered a security under certain conditions, particularly focusing on the third prong of the Howey test, which involves the expectation of profits derived from the efforts of others. In contrast, the SDNY judge ruled that XRP programmatic sales were not securities. This divergence in rulings has led to debate within the legal and cryptocurrency communities.
What stage is the Binance lawsuit currently in?
The Binance lawsuit is nearing the end of the discovery and deposition phase. Most discovery disputes have been resolved, and the parties are awaiting the court’s ruling on several motions, including a joint motion to dismiss the lawsuit.
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