- The SEC v. Ripple case is referred to Magistrate Judge Sarah Netburn, who previously ordered the release of the critical ‘Hinman Documents’.
- A partial victory for Ripple was observed on July 13 as allegations of illicitly posting XRP token on public exchanges were dismissed.
The ongoing legal saga of the United States Securities and Exchange Commission (SEC) versus Ripple takes a crucial turn. Judge Analisa Torres of the U.S. District Court for the Southern District of New York recently filed paperwork on July 17, forwarding the unresolved matters of the case to Magistrate Judge Sarah Netburn.
Transferring Oversight: A Step Towards General Pretrial
First reported by Eleanor Terrett, this advancement in the case involves an “amended order of reference to a Magistrate,” essentially assigning judiciary oversight of the case to the office of the magistrate. The single-page document, viewed by Cointelegraph, suggests that the case is progressing towards the general pretrial phase. This stage typically encompasses discovery and provides a narrow window for raising objections.
🚨NEW: District Judge Torres has referred the @Ripple case to Magistrate Judge Netburn for General Pretrial (includes scheduling, discovery, non-dispositive pre-trial motions and settlement). 👇🏼 pic.twitter.com/EyrA3flpXC
— Eleanor Terrett (@EleanorTerrett) July 17, 2023
The general pretrial phase is the most likely stage for a potential settlement. As per recent reports by Cointelegraph, industry experts opine that an appeal against last week’s rulings by Torres by the SEC seems improbable.
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In a significant win for Ripple on July 13, Judge Torres decided to discard the claim alleging Ripple’s violation of laws by listing its XRP token on public exchanges. This ruling has been interpreted as a validation that XRP is not a security, thus bearing implications for the entire cryptocurrency landscape.
Nevertheless, the allegations persist, asserting that XRP was sold as a security when Ripple directly sold it to investors via a marketing campaign that emphasized various aspects of XRP. According to the SEC, these aspects could potentially lead investors to perceive XRP as a security.
Judge Netburn, who previously issued the order for the release of the highly-anticipated “Hinman Documents,” will preside over this forthcoming phase. Some experts foresee the SEC possibly opting for a settlement with Ripple.
These “Hinman Documents,” a collection of SEC files that featured excerpts from a speech by then-Director William Hinman in 2018, were anticipated to serve as pivotal evidence. While their release may not have created the expected impact in the case as hoped by the cryptocurrency community, the subsequent partial victory for Ripple has undoubtedly influenced the overall cryptocurrency sentiment.
Given Judge Netburn’s history of challenging the SEC’s assertions in this case, there is a prevailing optimism that this positive sentiment will persist. As of the time of writing, XRP is trading at $0.72, a decrease from last week’s peak, but still a rise of over 56% since July 13.
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