A judge has ordered that the deposition of former SEC director William Hinman will proceed as planned, which is a significant victory for Ripple.
The SEC had filed a move to halt the deposition, prompting legal experts to speculate as to why the SEC is so adamant about defending the former executive.
Ripple Labs has won a significant legal win over the Securities and Exchange Commission of the United States. A US federal judge denied the SEC’s attempt to dismiss the deposition of William Hinman, the former director of its division of corporate finance, in a hearing on Thursday. Hinman is most known as the SEC employee who said Ether and Bitcoin were not securities, a declaration that has become a focal point in XRP’s securities fraud charges.
The Ripple case is “not a run-of-the-mill SEC enforcement matter,” according to Judge Sarah Netburn, who decided in Ripple’s favor. She also attempted to reassure the watchdog by stating that the deposition “wouldn’t release the floodgates.” This was in response to the Securities and Exchange Commission’s claim that this may set a precedent in which SEC personnel are deposed by every other company the watchdog pursues.
Judge Netburn did concede that when Hinman was at the SEC, he was a high-ranking official. Under typical circumstances, this exempts him from deposition, unless “special circumstances” apply. The deposition was necessary in the Ripple case because Hinman “had tremendous authority in a highly important government agency.”
Ripple is attempting to depose former SEC director William Hinman, but the regulator is resisting.
Why Hinman has the potential to make or break the case
A number of points that have been essential in the case were brought to the fore during the hearing. One of these was the SEC’s assertion that Hinman was speaking in his personal position, not as an SEC official, when he asserted Ether and Bitcoin weren’t securities.
“If Hinman was expressing his personal opinions, then how can a high-level official protective privilege apply to things that he uttered in his personal opinion only?” Judge Netburn enquired of the SEC’s counsel Ladan Stewart.
Ripple has been lobbying for the deposition to take place on Monday, July 19th, as planned. When the judge asked the two parties if the hearing would still take place on Monday, SEC Attorney Stewart said, “We will need time to reevaluate.”
This could only suggest that the SEC wants to appeal Judge Netburn’s decision, according to Attorney Jeremy Hogan.
The SEC’s decision to appeal this order signals to me that the SEC is desperate want this deposition to be canceled. I’m not sure why they’re so desperate, but there’s something about them that isn’t just “bad,” but truly horrible.
Judge Netburn, according to Hogan, will most likely limit the scope of questions Ripple can ask Hinman during the deposition.
What I mean is that there’s something to be discovered here, and the question is whether Ripple will be able to find it.
The XRP community, according to the attorney, was a major factor in the judge’s decision. Judge Netburn acknowledged that the Ripple case had a high level of public interest, which makes it unique. One of the reasons she chose to go ahead with the Hinman deposition was because of this.
William Hinman, Ripple’s SEC/n
