John Deaton, prominent crypto lawyer and founder of Crypto Law, has once again shared his opinion on the ongoing lawsuit between Ripple Labs and the U.S. Securities and Exchange Commission (SEC).
According to a tweet, the pro-XRP lawyer believes that a settlement of $20 million or less in the lawsuit between the crypto company and the U.S. regulator is a 99.9% legal victory for the former.
A 99.9% Legal Victory
Deaton stated that people who argued that the SEC got a 50-50 victory in its case against Ripple were wrong because it was more like 90-10 in Ripple’s favor.
The crypto lawyer’s comment was triggered by a tweet from Ripple’s chief legal officer, Stuart Alderoty, highlighting another legal loss for the SEC. The U.S. Court of Appeals for the Second Circuit ruled in the case of the SEC vs Govil that the agency cannot request a disgorgement award without first proving that XRP investors were harmed financially. If there is no financial harm, there wouldn’t be any disgorgement.
Recall that a few months ago, Judge Analisa Torres ruled that the secondary sales of XRP were not securities or investment contracts. While passing the verdict that gave Ripple its first landmark victory in the lawsuit, the judge also upheld the SEC’s arguments that selling the digital asset to institutions and sophisticated buyers violated securities law. The decision bolstered the agency’s claims of roughly $770 million from institutional XRP sales.
The judge has approved a joint request from the SEC and Ripple for a briefing to address the institutional sales of XRP.
The outcome of Judge Torres’ ruling stirred mixed reactions in the crypto community, with some people saying that the SEC got a 50-50 victory in the lawsuit. On the other hand, Deaton’s stance resonates with the belief of a larger part of the community, which considers the proposed $20 million settlement a favorable resolution for the crypto company.
While Deaton believes the case tilted in Ripple’s favor, he still insists that the SEC’s actions affected the potential mass adoption of XRP in the last three years and caused damages to the firm.