The U.S. Securities and Exchange Commission (SEC) has asked the judge in the SEC v. Ripple case to block Ripple and its executives from accessing various internal records it claims are unrelated to determining whether XRP is a security. The SEC says that the â€œdefendants do not actually seek relevant evidence, but rather seek to harass the SEC, derail the caseâ€™s focus away from its merits, and bog down the SEC with document review.â€
SEC Seeks to Limit Rippleâ€™s Access to Its Records
The SEC wrote a letter to Judge Sarah Netburn Wednesday attempting to block Ripple from accessing certain records. The letter followed the court order granting Ripple Labs, its CEO Brad Garlinghouse, and co-founder Christian Larsen (Defendants) access to the SECâ€™s records pertaining to XRP, bitcoin, and ether.
The order requires the SEC to search the external emails of 19 custodians for documents related to the three cryptocurrencies but denied the defendantsâ€™ requests for certain internal SEC communications considered irrelevant to the case, the letter describes.
The SEC confirmed that it is in the process of complying with the court order and â€œhas begun reviewing tens of thousands of external emails from the identified custodians for production pursuant to the order.â€ The court also required the parties to â€œmeet and conferâ€ about whether the SEC should produce certain official documents â€œexpressing the agencyâ€™s interpretation or viewsâ€ on XRP, bitcoin, and ether.
However, the SEC claims:
â€œRather than meet and confer about whether the SEC should review and produce or log certain internal documents reflecting agency views, Defendants wrote the SEC with a laundry list of documents they view as â€˜capture[d]â€™ by the order,â€ the commission asserted.
The list includes â€œthe very same internal emails that the court ordered the SEC did not have to review and produce â€” and not just with respect to bitcoin, ether, or XRP, but with respect to â€˜cryptocurrencyâ€™ generally.â€ The defendants also asked for â€œthe inclusion of a 20th custodian that was not subject to the order or the partiesâ€™ prior discussions.â€
This request goes beyond the â€œdocuments expressing the agencyâ€™s interpretation or viewsâ€ envisioned by the courtâ€™s order, the SEC claims, adding that the defendants â€œhave shown that they will continue to ignore the courtâ€™s rulings and demand more endless, burdensome, and unnecessary discovery.â€
The commission additionally alleges:
The defendantsâ€™ â€œnew request that the SEC search the personal devices of SEC employees fits into a broader pattern of trying to make this case about random and irrelevant communications by SEC staff instead of Rippleâ€™s unregistered offering of XRP,â€ the SEC elaborated. According to the commission, â€œThere is no basis to believe that SEC employees used personal email accounts or devices to express agency interpretations or views on bitcoin, ether, or XRP to the market.â€
The SEC, therefore, â€œseeks an order that resolves pending discovery disputes and bars Defendants from seeking irrelevant, privileged SEC staff materials that this court already ruled are not discoverable.â€ Specifically, the regulator seeks to prohibit the defendants from â€œobtaining internal SEC staff communications the court already excluded from productionâ€ and bar them from â€œsearching SEC staff personal devicesâ€ and â€œadding custodians.â€
Do you think the judge will rule in favor of Ripple or the SEC? Let us know in the comments section below.
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