Ripple lands “a very big win” in SEC case.

Ripple Labs has dealt a blow to the Securities and Exchange Commission (SEC) case after the presiding judge ruled that a Ripple community lawyer called “a very big win for Ripple.”

The SEC filed lawsuits in 2020 against Ripple and executives Brad Garlinghouse and Christian Larsen for selling unregistered securities.

Presiding Judge Sarah Netburn denied the SEC’s request to review privileged protection documents related to a June 2018 speech by Ripple’s then-director Willian Hinman. In the speech, Hinman said Bitcoin (BTC) and Ethereum (ETH) are not securities.

The SEC had previously not objected to these documents, which fell outside of Deliberative Process Privilege (DPP) protection, as it indicated they only concerned Hinman’s personal views, not Ripple’s policies.

The DPP exempts some documents from government disclosure in one case so that it can confidentially review existing policy based on the documents’ materials.

The SEC then changed course to argue that the speech reflected Ripple’s policies rather than Hinman’s personal views and should be shielded.

Judge Netburn said the SEC should not contradict itself when trying to reverse its claims. In her decision she wrote

“The SEC is trying to have both, but the speech should either reflect agency policy or it shouldn’t. Having insisted that it reflects Hinman’s personal views, the SEC now cannot refute its own position.”

James K. Filan, a Ripple community defender with an extensive file of financial and SEC cases, summarizes the critical aspects of Judge Netburn’s rejection tweeted today:

Another Ripple community advocate and founder of tweeted today to his 191,000 followers that “the SEC is now in a breached locker” following Judge Netburn’s decision.

Despite this seemingly important decision, the case is not closed and the SEC now has two weeks to appeal the decision.

Much of the crypto industry is fixated on the proceedings in this case, as its outcome could determine the future of SEC filings against crypto companies for the sale of unregistered securities.

Related: Greenpeace, co-founder of Ripple, campaigning to change the Bitcoin code

A Ripple win could mean the SEC retreating from its aggressive litigation against the crypto industry. However, if the SEC wins, the floodgates could open and attorneys familiar with crypto have a cottage industry in store for them.