Ripple Labs Inc. has taken a significant legal step in the lawsuit against the U.S. Securities and Exchange Commission (SEC) by submitting a motion to file a sur-reply. The motion addresses what Ripple terms as “significant factual mischaracterizations” presented by the SEC.
The legal maneuver, presented before Judge Sarah Netburn of the Southern District of New York, has added another layer of intensity to the already contentious case.
SEC requests audited financial statements and more
At the center of this legal battle is the SEC’s request that Ripple provide audited financial statements for 2022-2023. Additionally, the SEC is seeking documents related to the sale or transfer of XRP to entities other than employees.
Furthermore, the regulatory body is interested in obtaining information concerning the proceeds Ripple received from institutional XRP sales following the lawsuit’s initiation.
Ripple had previously objected to these requests from the SEC, claiming that they were overly burdensome. However, the SEC has vehemently refuted these objections, asserting that Ripple’s objections are baseless and inaccurate.
This ongoing dispute over document production and its burden on Ripple is a key point of contention in the case.
Ripple’s sur-reply motion
In response to the SEC’s refutations and the broader narrative surrounding the lawsuit, Ripple’s counsel has filed a sur-reply motion. This motion aims to clarify what Ripple believes to be inaccuracies presented by the SEC in its recent submissions.
One specific point of dispute highlighted in the sur-reply is the SEC’s portrayal of Ripple’s resistance to producing post-complaint contracts. Ripple argues that it specifically objected to the SEC’s request as “overly burdensome,” directly contradicting the SEC’s narrative.
The submission of this sur-reply motion marks a critical juncture in the ongoing legal proceedings between Ripple Labs Inc. and the SEC. As both parties continue to clash over the scope of document production and the burden it places on Ripple, the case has become increasingly complex.
What lies ahead
The outcome of this lawsuit has significant implications for Ripple and the broader cryptocurrency industry. The central question is whether XRP, the digital asset created by Ripple, should be classified as a security or a digital currency. The classification could have far-reaching consequences for how XRP is regulated and traded in the United States.
While the legal battle unfolds, market observers and participants closely watch the developments. The case has the potential to set a precedent for how the SEC regulates cryptocurrencies and how companies in the crypto space operate within the United States.