Both Ripple Labs and the U.S. Securities and Exchange Commission filed motions to summary judgment. They argued that the judge who is overseeing the case has sufficient information to make a decision without moving the case to trial.
Each of the U.S. Securities and Exchange Commissions (SEC) and Ripple labs want a federal judge ruling that either Ripple Labs or the crypto company associated with the XRP cryptocurrency broke federal securities laws, or dismissing the case without a lengthy trial.
Both Ripple and the SEC filed motions for summary judgement in the Southern District of New York. They asked District Judge Analisa Tores to rule based on arguments in the accompanying documents. Friday’s documents were posted to a federal court registry.
In December 2020, the SEC sued RippleLabs and CEO Brad Garlinghouse as well as Chairman Chris Larsen. This was just a day after Jay Clayton, former SEC Chair, resigned. The SEC claimed that Ripple had raised more than \$1.3 billion through unregistered securities sales. Ripple claimed that XRP sales were not in compliance with the Howey Test. This is a Supreme Court case used to determine whether something is a security over the past several decades.
The trial has lasted more than two years, Ripple vs SEC
Over the past two-years, the parties have filed a variety of discovery motions without actually litigating the underlying issue – whether Ripple sold XRP in violation of securities law. These motions for summary judgement are filed by the parties to ask the court to decide whether the SEC or Ripple have provided sufficient evidence to show that there was a violation.
The SEC argued that Ripple executives made statements indicating that Ripple had sold XRP and that XRP investors purchased the cryptocurrency in the hope that it would increase in value.
“Ripple publicly proclaimed the steps it was taking to find a use’ for XRP, and to preserve the integrity and liquidity the XRP markets,” said the SEC in its filing.
There was not a contract between xrp and its investors
Ripple, for its part, argued that there wasn’t a contract between the company XRP investors and the company, and that there wasn’t a common enterprise which is one of Howey’s requirements.
According to the filing, many XRP holders who purchased tokens through exchanges would not have known from whom they were buying them.
“Even if the SEC were to engage in a belated, post-discovery transaction-by-transaction analysis to identify XRP offers and sales with contracts, its claim would still fail as a matter of law. According to the filing, none of the contracts gave post-sale rights or obligations to Ripple to act in the best interests of the recipients.
