Ripple XRP News: Judge Torres To Deny SEC’s Motion In Remedies Phase

Ripple XRP News: The U.S. Securities and Exchange Commission’s reasons for arguing injunctions and disgorgement are weak and Judge Torres can deny the SEC’s argument that institutional investors suffered pecuniary harm, stated lawyer James Murphy, known as MetaLawMan by the XRP army.

Thursday, 09 May 2024 20:08

Why SEC Argument on Disgorgement Is Weak

Pro-XRP lawyer James Murphy in a post on X said the U.S. SEC’s reply brief does not add anything meaningful to the argument that institutional investors suffered pecuniary harm. The SEC seeks $876 million in disgorgement from Ripple Labs on the claim that some institutional investors have suffered harm. While Ripple argued that the Govil case precedent maintained that the SEC is not entitled to disgorgement if there is no financial harm to the buyer.

Murphy added that the SEC relies on SEC v. iFresh, a district court case, which held the “pecuniary harm” requirement is proved when a stock price is artificially inflated. The SEC asserts Ripple artificially manipulated XRP price through various ways including automated bots. Ripple executives have denied such claims many times earlier.

“In my view, the iFresh decision is a misreading of the 2nd Circuit holding in Govil on disgorgement. And, interestingly, the judge who wrote the iFresh decision designated it “NOT FOR ELECTRONIC OR PRINT PUBLICATION,” said MetaLawMan.

The SEC argued some institutional buyers suffered pecuniary harm as they received less discount on XRP as compared to others who paid more price.

Judge Torres to Deny SEC’s Argument

Judge Torres will likely deny the SEC’s motion in part for $2 billion in fines. James Murphy reasoned it is still wrong to cite a decision with a “not for publication” designation as precedent. These are considered the weakest precedents for any case.

However, he doesn’t rule out the possibility of Judge Torres going with the iFresh reasoning. Also, it is possible the Judge would schedule a hearing to resolve unanswered questions about the positions of the parties.

In response to James Murphy, lawyer Jeremy Hogan said “You have to request permission from the appellate court before citing to those cases. Hopefully, the Judge will catch that since Ripple has no reply.”

XRP price trades over $0.52, down more than 2% in the last 24 hours. The 24-hour low and high are $0.518 and $0.542, respectively.