The US Securities and Exchange Commission (SEC) has responded to Ripple’s motion application to seal and redact the company’s business details in the parties’ briefings on remedies. The SEC argued that Ripple’s request to conceal financial and securities sales information from the public was unlawful, as the details were crucial to the requested remedies. The SEC contended that Ripple’s redaction requests would obscure public information essential to the court’s decisions during the remedies phase. The details that the SEC wants Ripple to make public include the value of Ripple’s assets, recent sales figures, revenues and expenses, and discounts given to institutional investors.
The SEC further argues that Ripple has failed to provide reasonable evidence showing that the disclosure of publicly available information would result in substantial injury warranting protection. Although the SEC does not oppose keeping Ripple’s recent financial statements confidential, it opposes the company’s request to redact information about its revenues and expenses from 2014. The SEC believes that financial figures and specific terms used to justify remedy requests should be made public to ensure transparency and a fair legal process. The SEC also notes that some financial details are outdated and some evidence is publicly accessible.
The legal dispute between the US SEC and Ripple began on December 22, 2020, when the financial regulator charged Ripple and several of its executives with unlawfully raising over $1.3 billion through an unregistered securities offering via the sale of XRP. The case has undergone several revisions and is currently in its trial phase, which started on April 23, 2024. The SEC is seeking over $2 billion in fines and penalties from Ripple, while Ripple opposes the SEC’s demand, arguing that the civil penalty should not exceed $10 million.
Ripple filed a motion on May 14, 2024, to seal or narrowly redact some of its documents concerning the SEC’s motion for judgment and remedies. Ripple claimed that disclosing these non-public documents would cause significant harm to its business interests. The company wants to seal or redact highly confidential information concerning its earnings, revenues, and expenses, as well as contractual agreements with third-party business partners. Ripple is unwilling to disclose specific financial and pricing terms related to offering discounts to institutional XRP buyers.
The SEC’s filed response believes that Ripple’s business details should be made public as it could provide more insight into Ripple’s XRP sales and play a crucial role in the legal process. Despite Ripple’s reluctance to disclose certain information, the SEC argues that transparency is necessary for a fair legal process. Ripple’s CTO, David Schwartz, recently disclosed the XRP sales strategy without citing the SEC’s pressure as the reason behind the sales. The ongoing legal battle between the SEC and Ripple continues, with both parties presenting their arguments in court.
