According to Hinman’s remarks, neither Bitcoin (BTC) nor Ether (ETH) are securities.
Deliberative Process Privilege (DPP) protection was not previously an issue for the SEC.
The Securities and Exchange Commission (SEC) filed a lawsuit against Ripple and its CEOs Brad Garlinghouse and Christian Larsen in 2020. Presiding Judge Sarah Netburn refused the SEC’s request to review the privileged materials relating to a presentation given by the SEC’s then-director William Hinman.
According to Hinman’s remarks, neither Bitcoin (BTC) nor Ether (ETH) are securities. Deliberative Process Privilege (DPP) protection was not previously an issue for the SEC, which reasoned that the records solely pertain to Hinman’s personal beliefs and not SEC policy.
Should Not Contradict Itself
According to law, the DPP may examine current policy confidentially by exempting particular papers in a case from the government’s disclosure. The SEC then argued that the speech represented Ripple’s practices rather than Hinman’s personal opinions and should thus be protected. When the SEC tries to change its position, Judge Netburn says it should not contradict itself.
She wrote the following in her decision:
“The SEC seeks to have it both ways, but the Speech was either intended to reflect agency policy or it was not. Having insisted that it reflected Hinman’s personal views, the SEC cannot now reject its own position.”
James K. Filan, a Ripple community defense lawyer with vast experience in financial and SEC issues, tweeted today that the decision by Judge Netburn not to reconsider is a huge victory for Ripple.
In response to Judge Netburn’s order, another Ripple community lawyer and creator of CryptoLaw, who has 191,000 followers, tweeted that “The SEC is now in a hurt locker.” The SEC now has two weeks to appeal the verdict, despite this obviously critical judgment.