U.S. Judge Partly Grants and Denies Ripple’s Motion Against SEC Over Experts Reports

Judge Analisa Nadine Torres of the U.S. District Court for the Southern District of New York has partly granted and denied Ripple’s motion against the U.S. SEC’s “unprecedented” move to seal the identities and opinions of its experts in the lawsuit.

Ripple Files Motion Against SEC 

Earlier this week, Ripple Labs, the fintech company behind the Ripple payment protocol and the XRP cryptocurrency, filed a motion seeking to dissolve the SEC’s motive to conceal the names of its expert witnesses from the public. 

In its complaint filed on Sunday, the firm told the court that the Commission had insisted on sealing three of its experts’ testimonies involved in the case until the judge decides whether to shield the opinion of the fourth expert, whom the regulator said has faced “threats and harassment.”

Ripple argued that the SEC was “abusing” an order shielding information “to prevent criticism of its experts from reaching the public.”

“The SEC’s attempt to shield the identities and opinions of its experts from any public scrutiny is unprecedented and unsupported by any evidence of need,” the company’s lawyers said. 

The complaint noted that the three SEC officials whose identities the Commission is trying to conceal played a crucial role in the lawsuit. 

Recall that in 2020, the SEC slammed Ripple with a lawsuit arguing that the company issued unregistered securities to American investors through the sale of XRP tokens.  Ripple refuted the charges, noting that XRP should be treated as a digital asset like Bitcoin and Ethereum. 

SEC Responds to Ripple’s Motion

Following Ripple’s motion to uncover the identities of the three SEC officials, the regulator responded in a separate filing on Monday. The Commission stated that both parties involved with the case had been engaged in substantial negotiations since last week over the confidentiality designations of expert material under the Protective Order. 

However, Ripple rejected the proposal and filed a motion requesting the agency provide proposed confidentiality redactions, reports, and transcripts to its experts. In contrast, the firm has refused to extend the same courtesy to the security watchdogs. 

The SEC noted that contrary to Ripple’s assertion that it’s trying to evade public scrutiny of its officials, the regulator is simply seeking additional days to allow the parties to tidy hundreds of pages of its expert reports. 

The Court’s Verdict

After hearing from both parties, Judge Torres granted the SEC’s request to redact language and denied Ripple’s request to edit the citation to Exhibit O. The court also granted the Commission’s request to redact language in the Defendants’ Letter, except for the redaction of footnote one and its request to redact footnote one was denied.

 The Judge also denied other motions requested by both parties and ordered the Clerk of Court to destroy the remaining requests at the ECF Nos. 498 and 508.