Ripple’s defense team gets an opportunity to question William Hinman on his views on securities law: In the ongoing SEC vs. Ripple case, Judge Netburn has ruled that former SEC Director William Hinman will testify under oath.

Buy XRP on eToro Now

After charges were filed against Ripple in late December 2020, the case has turned into a complex beast that has to deal with numerous motions.

The latest motion relates to the SEC’s attempt to overturn Hinman’s removal and prevent him from testifying in court. However, Judge Netburn rejected this request, opening the door for the defendants to question Hinman in court.

The latest twist in the Ripple case

The U.S. Securities and Exchange Commission had tried to prevent Hinman from testifying because the legislation says high-ranking officials cannot be deposed. However, Judge Netburn felt that this should not apply due to the “exceptional circumstances” of the case.

Former director Hinman gave a speech in June 2018 in which he said that, in his opinion, ether is not a security.

“Based on my understanding of the current state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.“

This is relevant because Ripple used a fair notice defense when defending their position. Essentially, this is about whether Ripple has been reasonably and fairly informed by the SEC that its XRP sales represent the sale of a security.

Ripple claims XRP is similar to Bitcoin and Ethereum, and without fair notification otherwise they had no reason to believe they were breaking securities law.

The likely reason that Ripple wants to question Hinman is because of information that does not come from his 2018 speech alone.

What’s Hinman got to hide?

In rejecting the SEC’s request to overturn Hinman’s removal, Judge Netburn raised a problem: namely that Hinman said in his affidavit to the request that the speech was “intended to express my own personal views.”

Therefore, Judge Netburn asked the SEC’s legal team how to apply the high-level protective privilege when Hinman expressed his personal opinion on the matter.

Attorney Hogan gave his professional view on this, saying that Judge Netburn had thus shown that this was an “extraordinary circumstance”.

“She wanted to interpret that the speech was extraordinary and that Hinman said it was his personal opinion that Ether was not security. And this “exceptionality,” if that is a word, was the reason why she allowed the removal to go forward.”

Attorney Hogan’s analysis leads him to believe that the SEC will appeal this decision. However, he points out that situations like this rarely turn out in favor of the plaintiff, since the standard is almost impossible to meet.

Attorney Hogan concludes that the SEC is desperately trying not to enforce this removal. Which brings him to the question: what is the SEC trying to hide?

Buy XRP on eToro Now

Text credit: Cryptoslate

Last updated on July 17, 2021

Top Brokers for buying and trading cryptocurrencies

  • Buy Real Bitcoin or Bitcoin CFDs
  • Wallet and Exchange in one
  • 14 + Cryptos
  • EU regulated
  • Over 40 cryptos on offer
  • Fees rather in the midfield

Cryptocurrencies are a highly volatile, unregulated investment product. Your capital is at risk.