XRP Lawsuit: The SEC Underestimated Ripple, Asserts Law Professor — Here's Why

The SEC may have played its cards wrong in its move against Ripple about three years ago, J.W. Verret, associate professor of law at George Mason Law School, has said.

In an interview with Crypto Law founder and pro-Ripple lawyer John Deaton, Verret expressed his admiration for Ripple’s defence team, particularly praising CEO Brad Garlinghouse for his determination to face the SEC head-on.

“I don’t think they saw that coming, and I think they probably expected there would be a settlement, and I think they underestimated the fight inside of Brad,” Verret said on Thursday when asked about his opinion as to why the SEC picked the fight with Ripple. 

“I’ve learned there’s a lot of sand inside that fella, and I admire that. And he’s doing a service for everyone in crypto,” he added.

And Verret might be right. In a July 2022 interview, Brad Garlinghouse recognized the financial burden that the company had faced due to its ongoing legal battle with the Securities and Exchange Commission (SEC). 

At the time, Garlinghouse revealed that Ripple’s legal expenses might exceed $100 million by the time the lawsuit concludes. He, however, expressed his commitment to carry on, noting that the expenses are worth it.

Supreme Court Could Tame SEC’s Overreach on Crypto

Meanwhile, Verret further shared his thoughts on what lies ahead as the high-stakes securities lawsuit continues. According to him, no matter how it resolves, there’s a good chance it’ll be appealed to the Supreme Court of the United States (SCOTUS) by both parties.

The pundit, however, suggested that the crypto industry would stand to gain more if the matter is resolved by the highest court, noting that judges there would offer a remedy to all the regulatory uncertainty brought by regulators.

“I think it’s a perfect fit if you (ripple) are willing to go the distance to go SCOTUS. I think the supreme court will be willing to  take a look at crypto and use the SEC’s overreach in this area as a vehicle to transform administrative law itself,” he went on.

During a separate interview on the Unchained Podcast Friday, Verret noted he expects the lawsuit to conclude in the district court “relatively soon, in a matter of months or weeks.” According to him, Ripple could lose or win based on the fair notice defence, in which case it wouldn’t have a lot of implications for the rest of crypto” and the SEC lets it lie. However, if the firm wins on the Howey test, the SEC is “certainly going to appeal,” he said.

Source: Read Full Article