- A federal judge ruled that the SEC cannot seal documents related to William Hinman’s 2018 speech on crypto and securities, which is at the center of the ongoing lawsuit against Ripple.
- While the judge allows certain redactions proposed by Ripple, she deems others as “overbroad,” including those related to linking Ripple’s revenues with XRP sales and compensation offered to trading platforms.
SEC Denied Ability to Seal Hinman Speech Documents
In a blow to the U.S. Securities and Exchange Commission (SEC), a federal judge has ruled that the SEC cannot seal documents connected to William Hinman’s 2018 speech on cryptocurrency and securities. The speech, which has become a pivotal point in the ongoing lawsuit against Ripple, involves Hinman’s statement that he did not consider ether to be a security. District Judge Analisa Torres of the U.S. District Court for the Southern District of New York issued the ruling, affirming an earlier decision by Magistrate Judge Sarah Netburn in January 2022 that the documents should be turned over to Ripple as part of the discovery process.
Another win for transparency! Unredacted Hinman emails to be publicly available soon – stay tuned as the lawyers work through the mechanics to make that happen. https://t.co/o6puPypRHd https://t.co/qmaLVeQaP8
— Brad Garlinghouse (@bgarlinghouse) May 16, 2023
Redactions Allowed and Disputed in Ripple’s Proposed Documents
As part of the legal proceedings, Ripple sought to redact certain documents, including contractual agreements, financial information, and other types of information. Judge Torres has granted many of these proposed redactions, agreeing with Ripple that they are specific and targeted. This includes redactions related to the company’s financial statements and certain business information. However, the judge ruled that some of the proposed redactions were “overbroad,” particularly those associated with XRP.
For example, the defendants wanted to redact references linking Ripple’s revenues with XRP sales. They also sought to redact information about the compensation Ripple offered to trading platforms to list XRP, as well as the amount of XRP sales targeted at investors through programmatic and institutional sales. The judge deemed these redactions as excessive and not justified.
The ruling by Judge Torres signifies a setback for the SEC in its ongoing legal battle with Ripple. By denying the sealing of the Hinman Speech Documents, the judge emphasizes the importance of transparency and public access to relevant information in the judicial process. On the other hand, while allowing certain redactions proposed by Ripple, the judge ensures that they are appropriately limited and specific to protect sensitive business information.
The outcome of this ruling has implications for both the SEC and Ripple as they continue to navigate the lawsuit. It sets a precedent for the disclosure of documents tied to significant speeches made by SEC officials, which could have wider implications for the regulation of cryptocurrencies. The dispute over redactions demonstrates the need for a careful balance between transparency and the protection of legitimate business interests.
As the legal proceedings progress, the handling of sensitive information will continue to be a key consideration, with the court seeking to maintain fairness and transparency in the process.
In conclusion, the SEC has been denied the ability to seal documents related to William Hinman’s 2018 speech in the ongoing lawsuit against Ripple. Judge Torres ruled that these documents, known as the Hinman Speech Documents, are relevant to the judicial process and should not be sealed. While the judge allows certain redactions proposed by Ripple, she deems others as excessive and not warranted.
The ruling highlights the importance of transparency and public access to information while recognizing the need to protect sensitive business data. As the legal battle between the SEC and Ripple unfolds, the handling of documents and redactions will continue to shape the proceedings and potentially impact the cryptocurrency regulatory landscape.