SEC looks to prevent Ripple from getting vital document about its case

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The Unit­ed States Secu­ri­ties and Exchange Com­mis­sion (SEC) is unwill­ing to pro­duce doc­u­ments that show its for­mer finance direc­tor, William Hin­man, stat­ed that Bit­coin and Ethereum were not secu­ri­ties, accord­ing to a tweet from James Filan, a lawyer rep­re­sent­ing Rip­ple.

SEC files motion to protect Hinman’s speech

In a 2018 speech, William Hin­man said that he doesn’t think that Ether sales would con­sti­tute the sale of a security.

Rip­ple had filed for the doc­u­ment con­tain­ing this speech as part of its defense, but the SEC is bank­ing on the “attor­ney-client priv­i­lege” to pre­vent the cryp­to com­pa­ny from get­ting it.

Accord­ing to SEC’s motion

“The priv­i­lege applies because these doc­u­ments, in whole or in part, reflect com­mu­ni­ca­tions between Direc­tor Hin­man and SEC attor­neys request­ing and pro­vid­ing legal advice about a mat­ter under the SEC’s purview – when an offer or sale of a par­tic­u­lar dig­i­tal asset con­sti­tutes an invest­ment con­tract and thus a secu­ri­ties offer­ing as defined in the fed­er­al secu­ri­ties laws – and, cor­re­spond­ing­ly, what Direc­tor Hin­man could say about this mat­ter in the Speech.”

Hinman’s unique role in the legal battle

William Hin­man holds a van­tage posi­tion in the ongo­ing legal bat­tle between the SEC and Rip­ple. The reg­u­la­tor has con­stant­ly sought to pre­vent the cryp­to com­pa­ny from get­ting access to either his emails or speech­es, which some ana­lysts believe would be detri­men­tal to their case.

A non­prof­it whistle­blow­er orga­ni­za­tion, Empow­er Over­sight, revealed over 200 emails relat­ing to Hin­man and alleged that the emails prove that there were issues of con­flict of interest.

Per the mails, Hin­man was warned against meet­ing with any­one from Simp­son Thacher, a firm ded­i­cat­ed to pro­mot­ing the com­mer­cial use of Ethereum —a warn­ing he failed to heed. Apart from that, he was said to have met with the co-founders of Ethereum before he gave his now infa­mous speech of 2018.

This explains why the SEC has been reluc­tant to present Hin­man for a depo­si­tion. Accord­ing to the com­mis­sion, Ripple’s request would pro­vide a prece­dent that could lead to the tes­ti­mo­ny of top-rank­ing gov­ern­ment officials. 

A recent Cryp­toSlate report revealed that 

“Rip­ple Labs exec­u­tives and the SEC have agreed to extend the sched­ule of their case and delay hear­ings until the end of 2022.”



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