Ripple Wins Major Victory In The Long Battle With The SEC

Key Points:

• The SEC’s attempt to seal the contentious Hinman Speech materials from the public was refused by a judge, giving Ripple a victory.
• The paper pertains to a lecture delivered on June 14, 2018, by former SEC officer William Hinman.
• Hinman indicated in his address that the agency did not consider Bitcoin or Ethereum to be securities.

On Tuesday, a judge refused the Securities and Exchange Commission’s petition to seal papers related to a controversial cryptocurrency lecture, giving the besieged crypto company Ripple a legal win.

For years, the SEC and Ripple have been locked in a legal battle. In 2020, the commission charged Ripple with unlawfully trading its XRP coin without registering it as a security.

A section of the court struggle has centered on records related to former Division of Corporate Finance Director Bill Hinman’s 2018 lecture on cryptocurrencies, which included statements on why he did not believe Bitcoin and Ethereum to be securities.

The SEC has attempted to keep papers and discussions connected to the Hinman speech private, claiming at times that Hinman’s remarks represented his personal opinions rather than agency policy. The SEC also said that the records were part of Hinman’s commission responsibilities and are protected by legislation that protects internal discussions.

On December 22, the SEC filed a petition to seal the internal emails, text messages, and expert reports that followed Hinman’s speech, stating that its purpose trumped the public’s right to view materials that had no relevance to the court’s summary judgment ruling, among other things.

Nonetheless, U.S. District Court Judge Analisa Torres decided that the materials are judicial documents entitled to a high presumption of public access.

“They are judicial documents subject to a strong presumption of public access,” Torres wrote in the court filing.

Judge Torres further said that the court had rejected the SEC’s contention that sealing the papers is required to maintain openness and honesty within the SEC, stating:

“The Hinman Speech Documents are not protected by the deliberative process privilege because they do not relate to an agency position, decision or policy.”

Ripple CEO Brad Garlinghouse hailed the ruling as a victory for openness.

This assertion is a crucial area of contention in Ripple’s long-running legal struggle with the SEC. Last year, a court rejected another SEC effort to hide the Hinman speech records.

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