New York Judge Analisa Torres has ordered the Securities and Exchange Commission (SEC) to release internal documents, including emails and drafts, related to a 2018 speech by former Commissioner William Hinman.
The order marks a big win for Ripple in its legal battle with regulators, as the story behind the speech could hold the key to dismantling the SEC’s core legal argument.
Judge overrules SEC
According to that Letter Filed Thursday by Judge Torres, the judge overturned all three of the commission’s objections to the disclosure of the internal documents of the Hinman speech.
“The court has reviewed the remainder of the thorough and well reasoned orders for clear errors and finds none,” Torres’ letter said. “Accordingly, the court overrides the SEC’s objections and directs the SEC to comply with the orders.”
The SEC was originally asked by Judge Sarah Netburn to release the documents in January, finding they were not protected by Deliberative Process Privilege (DPP).
The SEC appealed the order the following month, claiming that the internal speech documents were not relevant to any claims or defense in the case. It also argued that the DPP does in fact protect internal language documents, as does attorney-client privilege.
However, the court agreed with Ripple on the matter, agreeing that the speech documents “may be used to obtain potential impeachment evidence or to charge witnesses in court,” including Hinman.
Also Torres affirmed that DPP does not apply because the requested documents do not relate to the SEC’s decision, position or policy – only Hinman’s personal opinion. Finally, the court will not protect the documents with attorney-client privilege because they were not clearly intended to be “interpreted.”[ing] and apply[ing] Principles of law to guide future behavior or to evaluate past behavior.”
What is the Hinman speech?
Hinman’s speech is notorious for commenting on the legal status of Ethereum contained, with the Commissioner expressing his view that the asset – next to bitcoin – is not a security. Similarly, Ripple’s litigation with the SEC concerns whether the company’s sale of XRP years ago constituted an unregistered securities offering.
Hinman’s internal emails are considered relevant to the case as some believe Hinman was involved in conflicts of interest on Ethereum. Previously, prior to his appointment to the SEC, he worked at Simpson Thacher – a law firm based on the Ethereum “Ethereum Alliance Company.” He has since returned to his position with the company.
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Source: Crypto News Deutsch