Ripple Claims SEC Financial Request Invalid, Irrelevant to Trial

Amidst XRP Price Drops, Analyst Eyes 55X Surge on SEC Lawsuit Resolution
Source: Crypto Economy

The long-running legal battle between crypto firm Ripple Labs and the U.S. Securities and Exchange Commission (SEC) continues with the latest dispute over the use of additional financial documents. In a new court filing, Ripple’s legal team argues that the SEC’s latest request is illegitimate and unrelated to the actual allegations.

The SEC recently demanded that Ripple provide audited financial statements for 2022 and 2023, contracts related to XRP token sales after the initial lawsuit, and information on institutional sale proceeds. However, the firm maintains that the discovery deadline to request evidence passed back in August 2021.

Ripple fights back against SEC’s request

“The SEC had ample opportunity to demand what material they deemed necessary,” stated the firm’s lawyers.

They note that the two sides already debated the relevance of post-complaint documents without the SEC making this specific request. Ripple also claims the SEC has already exhausted the number of written questions it could compel Ripple to answer.

“The SEC used all of its interrogatories in the case and cannot unilaterally grant itself more,” the filing asserted.

With the trial scheduled to start in April 2024, Ripple urges the court not to get distracted from the main issue at stake: whether Ripple conducted unregistered securities offerings via XRP sales. The additional financial information strikes the company as irrelevant to the core question before the court.

Some legal analysts speculate that the SEC aims to use the data to bolster a harsher penalty should it win the case. But again, the firm argues that has little bearing on the actual charges filed back in December 2020.

Ripple scored a partial win last summer when the judge determined that XRP serves more as a currency than an investment security in how it trades on cryptocurrency exchanges. However, the SEC continues to pursue charges over the firm’s direct distributions.

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