After an order from the US Securities and Exchange Commission (SEC), Ripple, the creators of the XRP token, have to product a million Slack messages between their staff members. According to the SEC, Ripple initially agreed to provide this data, but later refused, describing it as an “extensive and costly fishing expedition” that would take up too much resources and time. More specifically, they expect it to cost them as much as $1 million to produce the messages.
‘Unique and critical evidence’ in SEC’s case
Judge Sarah Netburn, who’s presiding over the case against Ripple for selling unregistered securities, insisted they produce the messages. In her opinion, they represent unique and critical evidence for the Commission’s ongoing case against the multibillion-dollar company.
Under the authority’s order, the company has to give access to messages from 22 custodians. According to SEC, Ripple’s previous consent to produce the messages outweighs its perceived burden and the messages are relevant to both parties in the case.
SEC released the following statement:
“The Slack messages sought are relevant to the parties’ claims and defences and proportional to the needs of the case. Any burden to Ripple is outweighed by its previous agreement to produce the relevant Slack messages, the relative resources of the parties, and the amount in controversy.”
The judge issued the order after the SEC was obligated to release some documents. She also ordered SEC to produce internal files on talks on the nature of Ethereum and Ripple during a conference call held on August 31 on occasion of the SEC’s privilege dispute. The judge will review those in-camera.
Background information
SEC raised allegations against Ripple back in December 2020. The watchdog accused current Ripple CEO Brad Garlinghouse and former CEO Chris Larsen of conducting an ongoing, unregistered digital asset securities offering with their XRP token sales. The executives countered that the token was not a security. Either way, it lost more than 50% of its value as investors started to sell in panic.
Proclaiming innocence
Since then, the token has recovered. As of the time of writing, it’s trading at $1.27. In June of this year, Larsen and Garlinghouse petitioned international watchdogs to request documents from Upbit, Huobi, Bitstamp, and a few other crypto exchanges. These documents allegedly prove the pair’s innocence. This is an effort for a motion to dismiss the SEC case.
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