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Attorney Deaton highlights the possible outcomes of the Ripple vs. SEC lawsuit that could determine the future of XRP secondary market transactions.
As the end of the lawsuit between Ripple and the SEC approaches, attorney John Deaton has taken to Twitter to highlight the possible outcomes of the case that could determine the coin’s future.
In a Twitter thread yesterday, attorney Deaton divided the possible outcomes into two parts: the four best outcomes favoring Ripple and XRP holders and the worst-case scenario favoring the SEC.
4 Best Outcome For Ripple & XRP Holders
According to attorney Deaton, Judge Analisa Torres, the presiding Judge of the lawsuit, could rule in four ways that could become a suitable outcome for the token.
For the first best outcome, attorney Deaton said Judge Torres could grant an outright win for Ripple while rebuking the SEC for gross overreach and its behavior throughout the case. He cited an instance where Judge Sarah Netburn, the assisting Judge, described SEC’s lawyers as hypocrites who lack faithful allegiance to the law.
Imagined #XRP outcomes:
Best outcome: outright win for @Ripple w/the Judge smacking the SEC for gross overreach and behavior in the case (Judge Netburn has commented SEC lawyers are hypocrites, lack faithful allegiance to the law, and only care about winning the next argument); https://t.co/gJXoxZX6cf
— John E Deaton (@JohnEDeaton1) March 31, 2023
Secondly, Judge Torres could rule that Ripple offered XRP as securities during the early stage of the ecosystem but that the token itself and secondary market sales do not constitute securities.
Thirdly, Judge Torres could send the case to trial to allow a jury to decide all undisputed facts. In this ruling, she could add that XRP is only a software code and that secondary market transactions aren’t securities.
Deaton noted that the last best outcome for the coin involves the Judge ruling that Ripple’s past and present XRP sales are securities while excluding future secondary market sales of the coin. He said: “Judge grants the SEC summary judgment Vs Ripple for both past and present sales of XRP as an investment contract but the judge makes clear her ruling has nothing to do with secondary sales of #XRP. Ripple appeals the case and we have the status quo for years.”
If Judge Torres rules that XRP secondary market transactions are not securities, US-based exchanges, including Coinbase, will be prompted to re-list the coin.
Worst-case Scenario
Meanwhile, Deaton, who represents XRP holders in the capacity of amicus curiae (friend of the court), highlighted the worst-case scenario that could happen. Per Deaton, the Judge might grant summary judgment in favor of the SEC against Ripple without commenting about XRP. If this happens, Deaton said he would ask the Judge to provide clarity, as he did in the LBRY vs. SEC lawsuit.
Worst case:
the judge grants summary judgment in favor of the SEC like the judge did in @LBRYcom but also makes no comment regarding the token itself or secondary sales. I would then attempt to do what I did in LBRY at a hearing on damages regarding secondary sales.— John E Deaton (@JohnEDeaton1) March 31, 2023
However, attorney Deaton thinks Judge Torres will comment on XRP secondary market transactions during her ruling. “I believe Judge Torres will comment regarding secondary sales and regarding the token itself.XRP holders’ amicus brief and 3500 affidavits are a big deal. SpendTheBits and TapJets amicus briefs are a big deal. The Judge knows the public interest at stake,” he added.
XRP Community Anticipates Ruling
Deaton’s assertions come as the XRP community anticipates summary judgment for the lawsuit. Many expected the ruling to come yesterday (March 31) due to predictions from Ripple’s general counsel Stuart Alderoty and former US prosecutor James Filan.
Since Judge Torres did not give her verdict yesterday, XRP community members are now focused on the prediction by Ripple CEO Brad Garlinghouse, who speculated that the summary judgment would come within the first half of the year.