Ripple wins subpoena for former SEC official to testify

U.S. District Judge Sarah Netburn rejected the SEC’s bid to block a subpoena requiring former SEC Division of Corporate Finance director William Hinman to testify. This was reported by attorney James Filan.

Filan added that the process of testimony could be delayed ‘for a short period’.

According to Bloomberg, in the motion the SEC argued that Hinman’s deposition “would disrupt the operations of government agencies, deterring qualified professionals from public service, given the near certainty that their powers would lead to litigation.” The regulator also called the fintech company’s request unfounded and unrelated to the case.

Netburn said the case “is connected to significant policy decisions in the markets.” The judge also noted considerable public interest in the proceedings.

Lawyer Jeremy Hogan noted that XRP token holders, who in March 2021 announced their intention to participate in the proceedings, played a role.

During the hearing, Judge Netburn acknowledged YOU — yes YOU in her ruling. She mentioned the significant «Public Interest» in the case as one reason why this was an exceptional case and a basis for the Hinman deposition. Phone line was maxed out at 4k again — congrats to you! https://t.co/vTJJe3avJa

— Jeremy Hogan (@attorneyjeremy1) July 15, 2021

Ripple’s interest lies in Hinman’s 2018 remarks, where he declined to classify Ethereum as a security, and he must now explain the principles behind that decision in court. The California company’s strategy is to frame the regulator’s action as unfair, pointing to his prior rulings on crypto.

In April 2021, Netburn granted Ripple’s motion for access to SEC documents disclosing its “interpretation and views” on Bitcoin and Ethereum.

Earlier the court denied the agency’s access to Ripple’s records of legal advice regarding the legal status of XRP, but allowed requesting information about the company under a memorandum of understanding with foreign regulators.

On June 15, the SEC secured a 60-day extension for the exchange of evidence in the fintech company’s case.

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