Ripple Believes Two 2012 Memos Will Bolster Its Case Against SEC

In a statement shared with Fox Business, Stuart Alderoty, Ripple’s general counsel, said that two documents from 2012 will show that the XRP cryptocurrency was not viewed as an unregistered security.

?NEW: Ripple’s General Counsel @s_alderoty statement to FOX Business:
“Once released, these documents will show that in 2012 Ripple received a legal analysis that XRP was not an investment contract. The fact that it took the SEC eight years to suggest they disagreed with that

— Eleanor Terrett (@EleanorTerrett) February 17, 2022

Alderoty added that it was ”baffling” that it took the U.S. Securities and Exchange Commission to voice opposition to that legal analysis:

We look forward to the public having access to these documents as we continue to vigorously defend this case.

In 2012, Ripple co-founder Chris Larsen, who is named as one of the defendants in the lawsuit, sought legal advice about the controversial cryptocurrency during the first year of the company’s existence. He received two memos from an undisclosed law firm.

The SEC asserts that Ripple was well aware of the fact that XRP is an unregistered security and knowingly chose to break the law.  

U.S. District Judge Analisa Torres delivered a blow to the defendants by issuing a court order to unseal the memos in question on Feb. 17. The defendants fought hard to keep the documents in question under seal, arguing that they contained sensitive information.

Either side could get a huge boost from making the docs public. If it turns out that Ripple is in the right, it will certainly bolster the company’s pivotal fair notice defense. If the documents show that Ripple knowingly decided to violate security laws, it would be a massive blow to its already fragile case against the SEC.