Ripple Vs SEC Update: Here’s What To Expect On May 6

In the ongoing legal conflict between Ripple and the US Securities and Exchange Commission (SEC), which heavily impacts the price of XRP, the two parties are at odds over whether testimony from SEC’s Assistant Chief Accountant, Andrea Fox, should be allowed. Ripple has recently submitted a letter supporting its motion to dismiss new expert evidence. They argue that Fox’s statements qualify as expert testimony and should have been introduced earlier during the remedies discovery phase. The SEC plans to reply by May 6, and the court is expected to make a ruling soon after.

The Ongoing Battle Between Ripple And SEC

The SEC’s recent filing featured remarks by Assistant Chief Accountant Andrea Fox concerning Ripple’s financial statements. Ripple labeled these remarks as “new expert materials” and argued they should have been presented earlier during the lawsuit’s remedies discovery phase, which is now closed.

In response, the SEC countered that Fox’s comments were not expert testimony but rather “facts and some basic arithmetic.” As a result, the SEC has requested that the court reject Ripple’s motion to exclude these new expert materials from the case.

Read more: Ripple vs SEC Lawsuit Update: Ripple Asks Court to Dismiss SEC Expert Evidence

Yesterday, Ripple submitted a letter to support its motion, arguing that the statements made by the SEC’s Assistant Chief Accountant Andrea Fox qualify as expert testimony. The letter explains that Fox’s analysis, which draws on her accounting expertise to evaluate Ripple’s financial records, should have been disclosed during the earlier remedies discovery phase of the lawsuit. Ripple’s letter states that regardless of whether Fox is viewed as an expert or a summary witness, the SEC was obligated to reveal this information before the end of that phase.

The SEC is scheduled to respond by May 6. Following this, the court is expected to make a decision regarding the penalties and fines Ripple faces for its institutional sales of XRP. The SEC has proposed fines totaling $2 billion, whereas Ripple has suggested settling for $10 million.

What To Expect On May 6?

The SEC is set to respond on May 6 to Ripple’s latest arguments. Observers believe the SEC will continue to push for disgorgement and seek a court order to prevent Ripple from selling XRP to institutional investors in the future. The SEC’s recent challenge to Ripple’s request to exclude new expert evidence indicates they’re looking to solidify their case. These next submissions are likely the last ones before Judge Analisa Torres decides on the penalties for Ripple’s sales of XRP to institutional buyers.

If Ripple successfully challenges Fox’s declaration, it could restrict the SEC’s options for advocating certain penalties.

The lawsuit began in late 2020 when the SEC accused Ripple of violating securities laws through its XRP sales. In July, Ripple achieved a partial win when a judge determined that XRP sales on exchanges do not constitute securities transactions. However, the dispute over sales to institutional buyers is still ongoing.