John Deaton of Deaton Law Firm LLC., in the United States, believes that Ripple will not lose its lawsuit against the Securities and Exchange Commission (SEC) as was the case in the LBRY lawsuit.
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Deaton perceives that many members of the public would expect the payment platform to suffer the same fate as LBRY. Also, the U.S. regulator may cite its victory over the blockchain-based file-sharing and payment network LBRY as a way of turning the case in its favor.
While he believes that the SEC may raise this to gain support from Analisa Torres, Deaton argued that people who expect Ripple to lose are not familiar with the latest happenings concerning the case. According to Deaton, these ones have only familiarised themselves with the SEC’s last brief, they are not aware of so many strategies which Ripple has taken, unlike LBRY.
“Many of these folks haven’t read one brief in the case, and the ones that did, read the SEC’s last brief (which, in all honesty, was the SEC’s best work product in the case). It was better b/c it was a REPLY brief, responding to Ripple’s arguments,” the attorney stated.
LBRY Loses Lawsuit to SEC
LBRY’s case with SEC had been a violation of securities laws (against Section 5 of the Securities Act of 1933) in that the blockchain-based file-sharing firm was involved in the sales of native LBC tokens as securities. Meanwhile, this token was not registered with the U.S. SEC. Contrary to the SEC’s claim, LBRY argued that LBC tokens were not securities.
Instead, LBRY categorized the LBC token as a digital asset that “functions as a digital currency that is an essential component of the LBRY Blockchain.” After getting indicted in March by the regulator, LBRY lost the lawsuit.
As per a statement made by U.S. District Judge Paul J. Barbado, “no reasonable trier of fact could reject the SEC’s contention that LBRY offered LBC as a security, and LBRY does not have a triable defense that it lacked fair notice, the SEC is entitled to judgment.”
In the case of Ripple, Deaton explained that the Ripple lawsuit is already in the second circuit unlike that of LBRY. Secondly, he said Ripple and its XRP holders have questioned the component of the Howey Test.
As the summary judgment of the lawsuit draws nearer, the presiding judge has approved more amicus briefs both in support of Ripple and SEC.
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