Protracted Ripple-SEC Legal Battle Anticipated, Outcome Could Depend on Coinbase's Lawsuit
Summary:
Attorney John Deaton, a supporter of Ripple, anticipates a drawn-out legal battle between the Securities Exchange Commission (SEC) and Ripple, potentially lasting up to a year. He believes a settlement could depend on the outcome of Coinbase's request to dismiss its own SEC lawsuit. Deaton also discussed how Ripple could endeavor to minimize the SEC's demanded $770 million penalty. The verdict on Coinbase's case - scheduled for early 2024 - could impact the timing and outcome of Ripple's case, he suggests.
Attorney John Deaton, an advocate for Ripple, predicts a long-lasting legal battle between the Securities Exchange Commission (SEC) and Ripple, which could extend up to a year. He believes that a possible settlement could hinge on the success of Coinbase's request for dismissal of its ongoing SEC lawsuit. In a comprehensive post on X (previously Twitter), Deaton shared his thoughts on the deficient serious discussions for settlement between Ripple, its executives and the SEC. He brought up the SEC's demand for a penalty of $770 million and unraveled the complex layers of the punitive phase, which encompasses a variety of legal proceedings. “To my mind, there hasn't been a single earnest dialogue concerning a settlement between Ripple, Brad Garlinghouse, Chris Larsen and the SEC. The SEC is disgruntled and humiliated and seeks $770M in reparation,” Deaton stated. He further elaborated how the penalty phase is an intricate process, resembling a secondary lawsuit, encompassing depositions, demands for documents, emails, financial records, contracts, and on-demand liquidity (ODL) transactions. The prosecutor believes that Ripple could strive to minimize the hefty $770 million penalty by ruling out ODL transactions and cutting other costs. Deaton also referred to the LBRY lawsuit, where the SEC initially sought $23 million and, after a prolonged eight-month legal battle, was reduced to a mere $130,000 fine.
Setting a timeline, Deaton said, "I do not foresee a definitive judgment handed down by Judge Torres earlier than the late summer. This case could drag on for an entire year before an appeal gets lodged." Deaton linked the ruling in Ripple's lawsuit to another high-profile lawsuit, claiming that if Coinbase's request for dismissal is granted, the SEC may reconsider its stance on cryptocurrencies and could contemplate a settlement with Ripple. However, if Coinbase's motion is denied, he anticipates no settlement will transpire.
The oral hearing for Coinbase's motion is scheduled for January 17, 2024, with a verdict expected within the subsequent two to four months. Ripple is anticipated to bear substantial legal expenditures in this period as it tries to lower the $770 million penalty. The outcome of the Coinbase case could influence the SEC's bid to delay the final judgment on Ripple, which aligns with Deaton's late summer forecast.
Published At
10/26/2023 8:33:13 AM
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