Judge Mandates Ripple’s Compliance with SEC’s Fresh Discovery Requests on XRP
A federal judge has sided with the U.S. Securities and Exchange Commission (SEC), directing Ripple to adhere to the regulator’s post-complaint discovery demands regarding XRP. Additionally, Ripple is mandated to respond to an interrogatory regarding the sum of proceeds from institutional sales of XRP it obtained subsequent to the filing of the SEC complaint.
U.S. Magistrate Judge Sarah Netburn ruled in favor of the U.S. Securities and Exchange Commission (SEC) against Ripple Labs regarding XRP on Monday.
The SEC seeks to compel Ripple to furnish “2022-2023 financial statements” and “post-complaint contracts governing ‘institutional sales.'” Additionally, the SEC demands Ripple to “answer an interrogatory regarding the amount of XRP institutional sales proceeds it received after the complaint was filed,” according to Monday’s court document, which states:
“The SEC’s motion is granted in full.”
Ripple had raised objections to the SEC’s motion, arguing that the requests were “untimely” and lacked justification on their merits. Ripple also contended that the information sought by the SEC was irrelevant to the court’s determination of remedies.
Regarding Ripple’s financial statements, the court document clarifies, “At this stage, the Court sees no basis to short-circuit that inquiry by denying access to readily available information that may be probative to the remedy stage.”
Regarding the post-complaint contracts, the court disagreed with Ripple’s assertion that their production would lead to an improper or costly “mini-trial.” Concerning post-complaint XRP institutional sales proceeds, the judge ruled that “the SEC has made a sufficient showing that this information may assist the Court in fashioning its remedy,” and thus, “Ripple must respond to the interrogatory.” The Court has set February 12 as the deadline to conclude the “remedies-related discovery.”
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