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A Reminder of What Request For Admission (RFA) 4 Was All About


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Posted (edited)

As a reminder ... an RFA is a way to short circuit agreed-upon facts into the court. Ripple ask for tens of thousands of RFAs in several sets. The 4th set was about contracts. Specifically, the SEC claimed that 1,700 Ripple contracts were part of an ongoing securities offering. Ripple wanted the SEC to identify any specific provisions in them that were considered 'investment contracts'. The SEC admitted to never actually reading them cuz it was too burdensome.

The court said that if the Fair Notice Defense was tossed, the SEC didn't have to answer. As we know, the FND was not tossed, so here we are. 

This recent filing indicates that the SEC replied to this 4th set of RFAs, but Ripple clearly isn't content with their answers and is asking the court to compel the SEC to answer better/differently/more thoroughly (it's not exactly clear). There were many questions over a wide range of topics. 

Here is a link to an article in FinancialFeeds entitled "RIPPLE’S NEXT MOTION TO COMPEL COULD FORCE SEC TO ADMIT THERE WAS NO INVESTMENT CONTRACT ON XRP SALES" that sums it all up, along with what Jeremy Hogan opined last year:

“[The SEC] either has to admit there is nothing in writing that forms an investment contract and therefore admit that the case is circumstantial, or it can go through each and every contract and try and find something in the contract that somehow ties Ripple to people who bought XRP on Coinbase last year”.

Here is a Twitter link to the most recent filing. 

 

Edited by RobertHarpool
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Posted (edited)

Ahhhh..... so, here's the entire ball of wax regarding Ripple's issues with the SECs 'responses' to RFA 4. 

https://www.dropbox.com/s/cce8nhpzsyko40i/Ripple Defendants’ Motion to Compel Regarding Requests for Admission.pdf?dl=0

First, the SEC refused to respond to the request for correspondence from market participants because they say that term is vague and ambiguous, though the SEC uses it numerous times in multiple filings. 

Second the SEC claims XRP first appeared on their watchlist on April 13, 2018, however they refuse to admit that XRP did not appear on their watch list before April 13, 2018. 

Third, the SEC has similarly claimed in other discovery documents that there was no trading policy for crypto trading by employees in effect before Jan 19, 2018, however they refuse to admit to this in an RFA. 

Fourth, the SEC won't answer RFAs regarding an Oct 2013 meeting with Larsen because they claim not to have sufficient info to admit/deny them. Some are as simple as admitting that someone from the SEC attended!!

Fifth, the SEC won't answer RFAs about No Action Letters cuz they claim the term 'digital assets' is vague and ambiguous. 

Sixth, the SEC has not submitted complete documentation pertaining to several RFAs

Seventh, the SEC would not authenticate recorded remarks made by SEC Commissioners and senior personnel. 

 

So ... I guess my original post was off in terms of what part of RFA 4 was causing the issues .. good to know now! 

 

 

Edited by RobertHarpool
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3 hours ago, RobertHarpool said:

Ahhhh..... so, here's the entire ball of wax regarding Ripple's issues with the SECs 'responses' to RFA 4. 

https://www.dropbox.com/s/cce8nhpzsyko40i/Ripple Defendants’ Motion to Compel Regarding Requests for Admission.pdf?dl=0

First, the SEC refused to respond to the request for correspondence from market participants because they say that term is vague and ambiguous, though the SEC uses it numerous times in multiple filings. 

Second the SEC claims XRP first appeared on their watchlist on April 13, 2018, however they refuse to admit that XRP did not appear on their watch list before April 13, 2018. 

Third, the SEC has similarly claimed in other discovery documents that there was no trading policy for crypto trading by employees in effect before Jan 19, 2018, however they refuse to admit to this in an RFA. 

Fourth, the SEC won't answer RFAs regarding an Oct 2013 meeting with Larsen because they claim not to have sufficient info to admit/deny them. Some are as simple as admitting that someone from the SEC attended!!

Fifth, the SEC won't answer RFAs about No Action Letters cuz they claim the term 'digital assets' is vague and ambiguous. 

Sixth, the SEC has not submitted complete documentation pertaining to several RFAs

Seventh, the SEC would not authenticate recorded remarks made by SEC Commissioners and senior personnel. 

 

So ... I guess my original post was off in terms of what part of RFA 4 was causing the issues .. good to know now! 

 

 

My understanding is that clear answers would clarify the regulations for crypto industry, as they that would become grounds for other crypto to defend themselves from future arbitrary actions against them by SEC.  In short simply answering these questions undermines SEC's strategy for controlling the market by enforcement.  

This request puts the heat under SEC to negotiate a settlement, in the same way as handing over the emails does.

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@Julian_Williams

I find that Fred makes a couple unwarranted leaps of logic by misreading what was written. (The SEC never said in the RFAs that "XRP was not viewed as a security" (Tweet 4/15)) .... I also find him to be overly enthusiastic about his SEC animosity. 

But, he is a sure-fired asset to the community nonetheless, and clearly knows far more than I ever will about the process, language, meanings, etc. 

 

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8 hours ago, RobertHarpool said:

@Julian_Williams

I find that Fred makes a couple unwarranted leaps of logic by misreading what was written. (The SEC never said in the RFAs that "XRP was not viewed as a security" (Tweet 4/15)) .... I also find him to be overly enthusiastic about his SEC animosity. 

But, he is a sure-fired asset to the community nonetheless, and clearly knows far more than I ever will about the process, language, meanings, etc. 

 

I agree with Bill the Attorney; Now is the window for SEC to settle and avoid the embarrassment of showing the emails (and agreeing defining the regulations through RFAs).  It is a last chance for the SEC, but I also worry that Gensler is in denial and stubborn and will veto settling.

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Read the high lighted parts, SEC are now relying on Ripple defence arguments to "stop" (delay, tehe judge is unlikely to buy this rubbish) publication of emails 

1 hour ago, VanHasen said:

I respectfully doubt it

SEC can spin out delaying the publication of the emails, and then they can move on to spinning out the judgement day.

 

 

 

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