In a letter to Federal Judge Analisa Torres, Ripple Labs responded to the US Securities and Exchange Commission’s anticipated move to block the blockchain company’s basic “fair reporting” defenses, calling it “unfair”:
The expected motion of the SEC is worthless. Trying to thwart positive defenses is not welcome at this stage, and the SEC cannot avoid showing that there are no real or legal issues that could allow the defense to succeed.
He is asking the court to dismiss CEO Brad Garlinghouse and co-founder Chris Larsen of the case, and the SEC not to set a joint briefing schedule for them.
If the SEC continues to present its unfair motion, Ripple respectfully demands that the Court’s default briefing program be disconnected from the refusal actions of individual defendants. Because one has nothing to do with the other.
The SEC claimed that Ripple’s defense was “legally inappropriate” because it did not have to warn exchanges about the company’s violations while it was still under investigation.
However, according to Ripple’s lawyers, the agency’s past sanctions and statements have shown that XRP is not a security:
Market participants have reasonably understood based on legal language, case law, previous actions and enforcement actions by other regulators, and public statements by SEC and SEC officials that XRP is not a security.
Ripple reiterated that the Financial Crimes Enforcement Network declared XRP as a cryptocurrency, although the SEC’s 2015 deal with FinCEN did not exempt the company from complying with securities laws.
This lack of fair disclosure, Ripple vs. FinCEN and USA Adal