Judge orders SEC to produce materials related to Hinman speech in Ripple case

A magistrate judge has reaffirmed that the Securities and Exchange Commission (SEC) must hand over documents related to former Commissioner Bill Hinman’s speech on cryptocurrencies in its case with Ripple.

Magistrate Judge Sarah Netburn’s opinion further accused the regulator of adopting arguments to further its desires rather than adhere to the law.

The SEC first brought a case against the distributed ledger tech company in 2020, when it alleged the sale of its XRP token constituted an unregistered securities offering.

Ripple has pushed back since then, claiming XRP isn’t a security and taking aim at what it sees as a lack of clarity in the regulator’s stance on crypto.

A 2018 speech by former Director of the Division of Corporate Finance has become a sticking point in the case.

In those remarks, Hinman explained why he didn’t consider bitcoin and ether to be securities.

Ripple has been seeking to obtain documents and communications related to the speech, while the SEC has employed multiple conflicting arguments in an attempt to shield them.

The SEC first argued that the speech consisted of Hinman’s personal views on crypto rather than an agency-wide policy. But then, it attempted to paint the speech as part of Hinman’s SEC duties by arguing the communications were protected by deliberative process privilege.

The Court was unconvinced by both arguments, ruling that the SEC would have to produce the documents.

The securities regulator made another attempt to shield the documents in June by arguing that attorney-client privilege applied to the speech, as it was developed with SEC attorneys as part of Hinman’s official duties.

The judge accuses the agency of trying to have it both ways, first arguing the speech was irrelevant since it reflected personal views and later that the evidence should be protected because it was official agency deliberations.

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