Ripple Requests One Week Extension for Documents in SEC Suit

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Tim Hakki

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Tim Hakki

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February 7, 2024

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Ripple has filed a motion requesting an extension of one week to gather and submit documents in its ongoing courtroom battle against the SEC.

The documents under examination largely comprise financial statements covering the period from 2022-2023. In addition, the SEC seeks “post-complaint contracts governing ‘institutional sales.’”

Ripple’s filing with the US Southern District of New York District Court, dated yesterday, says the XRP progenitor requests an additional eight days in order to deliver the goods. The company cites “the large volume of documents” required to suggest that the current time window is insufficient.

#XRPCommunity #SECGov v. #Ripple #XRP @Ripple requests a one-week extension of the deadline for remedies-related discovery, from February 12, 2024 to February 20, 2024. pic.twitter.com/xjIZQuY7jQ

— James K. Filan 🇺🇸🇮🇪 (@FilanLaw) February 6, 2024

On November 9, the counter-parties filed a joint letter agreeing to a ninety day discovery period. They subsequently disputed details of the SEC’s discovery request, including the relevance of Ripple’s post-complaint conduct, a point that the SEC had previously conceded to Ripple.

Judge Sarah Netburn ruled in the SEC’s favour on February 5, 2024. Her ruling compelled Ripple to come up with the requested documents by February 12, a narrow margin of just seven days.

The new filing notes that the SEC consents to Ripple’s extension request to submit everything by February 20.

Going forward, the company intends to produce the financial statements and respond to the SEC’s request about post-complaint conduct from pre-complaint contracts by the fact discovery deadline of February 12. It requests the extension in order to gather trickier items, like “contracts for the sale of XRP to institutional buyers, hedge funds, and ODL customers from a roughly three-year period.”

Ripple vs SEC: Far From Over

The Ripple vs SEC case has been ongoing since December 2020. The federal agency’s suit accuses Ripple of illegally raising $1.3 billion through sales of its blockchain’s native XRP token, which it alleges is as an unregistered security.

In July last year, Judge Analisa Torres ruled that XRP “is not necessarily a security on its face” and programmatic sales of XRP to the public were not securities sales. This was widely seen as a victory in the crypto industry.

In his war on crypto, SEC chief Gary Gensler has long argued that virtually every cryptocurrency is a security except Bitcoin, which he considers a commodity. While he demurs on the question of Ethereum, he is caught on tape in 2018—three years before he took up his post at the SEC—saying that Ethereum, Bitcoin, Litecoin and Bitcoin Cash are not securities. At the time he was an MIT lecturer and former chair of the Commodity Futures Trading Commission.

However, Torres also stated at the time that approximately $728 million of institutional sales of XRP did qualify as securities offerings because those buyers were expecting to profit in a common enterprise.

In October 2023, the SEC threw out its claims against Ripple CEO Brad Garlinghouse and Executive Chairman Chris Larsen.