Tag: Motion to Intervene

A Letter to Judge Torres – signed by 10,000, and counting…

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By John E. Deaton, Founder and Host of CryptoLaw.

Today I filed a pre-motion letter to Judge Analisa Torres to share the reasons why we are asking to intervene in the SEC v. Ripple case. Among other topics, the letter addresses why we should be allowed to intervene in the case and establish our interests in its ultimate result. 

Allowing us to intervene is appropriate because neither party in the case currently represents the holders and users of XRP.  A key aspect of Ripple’s defense will be to demonstrate that they have no duty or obligation to XRP holders, and given the SEC’s actions thus far, we can’t expect it to even consider the interests of XRP holders.

However, whether we like it or not, we have been impacted by this SEC lawsuit and will certainly be impacted by the ultimate result.

If allowed to intervene, among critical interests, we will demonstrate that XRP is a government-recognized currency that is completely independent of Ripple. We will show how XRP is being used in the U.S. and around the world as a currency.

For example, six years ago, the Financial Crimes Enforcement Network (“FinCEN”) entered into an agreement with Ripple that XRP would be considered a virtual currency and its use would be registered exclusively with FinCEN, not the SEC. Afterwards, foreign nations started agreeing with the U.S. government’s 2015 currency classification of XRP, and Japan, Switzerland, the U.K. and the UAE have all declared XRP is not a security. Since that 2015 designation as virtual currency, the use cases of XRP have exploded.

The number of XRP holders joining this effort is now over 10,000 and growing.  We are determined to tell our story.

See the full pre-motion letter, posted to the CryptoLaw Document Library here.

If you are an XRP holder who wants to join in legal actions related to this case, fill out this form with the Deaton Law Firm here.

Over 6,000 XRP holders volunteer as third party defendants in SEC lawsuit

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By Greg Thomson – March 15, 2021. (Cointelegraph).

XRP coin holders have attempted to insert themselves as third-party defendants in the United States Securities and Exchange Commission’s lawsuit against Ripple Labs.

A motion to intervene was filed by John Deaton of Deaton Law Firm on March 14 on behalf of over 6,000 XRP holders. Deaton — himself an XRP holder — argued that the interests of coin holders were not being adequately represented in the securities lawsuit against Ripple Labs and its executives.

Deaton’s argument builds upon the refutation of any securities violations by Ripple Labs. Specifically, if XRP is not a security, as Ripple executives Bradley Garlinghouse and Christian Larsen claim, then the efforts of said executives have no bearing on the performance of XRP.

Read the Full Story Here.

The SEC said everything will be decided in New York. So, here we come.

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By John E. Deaton, Founder and Host, CryptoLaw.

On December 22, 2020, former SEC Chairman Jay Clayton directed the filing of the most significant SEC enforcement action in modern history on his last day. The SEC complaint named defendants Ripple Labs, along with, co-founder Chris Larsen and CEO Bradley Garlinghouse.

The SEC action against Ripple and its executives caused over $15 billion in losses for XRP holders in the days following it.

Clayton’s action against Ripple, and its impact on retail investors, was the culmination of more than a decade of the SEC refusing to set clear rules of the road for the treatment of digital assets or the development of projects that used them.  They have chosen to set policy by enforcement, dismissing the interests of the people they have a mission to protect.

So, on January 1, 2021, I filed a Petition for Writ of Mandamus in Rhode Island Federal District Court, asking the SEC to amend its complaint to limit the impact on XRP holders.

On March 5, the SEC responded with a motion to dismiss my petition. In it, the agency again shirked any responsibility for the catastrophic harm caused by its actions against Ripple and its executives. Instead, the SEC blamed cryptocurrency exchanges for causing the financial harm suffered by XRP holders, despite Jay Clayton himself having been warned of the massive impact by former SEC commissioner Joseph Grundfest.

In its motion to dismiss my petition, the SEC  said that the US District Court for the Southern District of New York is the only forum to weigh all matters related to their actions against Ripple, and XRP holders by default:

“Here, an avenue for judicial review of the Commission’s complaint against Ripple clearly exists. The Southern District of New York will decide whether the complaint warrants any relief. Thus, the Commission’s enforcement proceeding in the Southern District of New York, brought under the Securities Act, supplies the exclusive method for testing the validity of the Commission’s complaint against Ripple.”

If the Southern District of New York is the exclusive venue for decisions that have already proven to have a massive impact on XRP holders and are likely to set the course for the future of all cryptocurrencies in the U.S., then that’s where we must go.

Ripple, Larsen and Garlinghouse are focused on defending their interests against the SEC’s attack, and the $1.3 billion the agency requested from them in damages. It’s not up to them to defend mine, or the interests of any other XRP holders.  We didn’t buy XRP from them, nor did we consider Ripple’s success as a company when we bought it.   It’s up to us to defend ourselves against the SEC.

Today I am filing a motion to intervene in that case in the exclusive venue to represent our interests.  I’m calling the agency on its arguments, and I will see this through to the end. That motion and others related have been uploaded to the CryptoLaw document Library:

If you are an XRP holder and want more information on joining this action, fill out an online form that my law office has made available here.