6,000 XRP Holders Want Their Voices Heard In SEC’s Lawsuit Against Ripple Labs
XRP holder and crypto enthusiast John E. Deaton of Deaton Law Firm on Sunday filed a renewed petition to have over 6,000 XRP holders testify as third-party defendants in the ongoing lawsuit by the Securities and Exchange Commission (SEC) against Ripple Labs.
6,000 XRP Holders Want To Testify
According to the filing, the SEC is not fully representing XRP holders’ interests in the lawsuit. With this new filing, Deaton and 6,000 XRP hodlers want to be involved in the case as a third-party defendant.
In a continued correspondence Deaton sent to Judge Analisa Torres, the legal representative said he had informed the financial regulator of his intention to file a class-action lawsuit against the agency, citing the SEC's intentional misconduct and abuse of discretion as reasons.
In the letter to Judge Torres, Deaton said that he previously filed a writ of mandamus against the SEC in the Federal District Court of Rhode Island on Jan.1 following the lawsuit against Ripple Labs and two of its executives. The January lawsuit demands were for the regulatory agency to exclude present-day XRP held by XRP investors from the securities category.
He had also demanded that whatever funds were received from the defendants should be placed in a constructive trust for XRP holders who incurred losses in connection to the XRP enforcement action of December 2020.
Another subpoena was brought against the SEC on Jan. 12, 2021, with the commission dismissing both.
In a blog post published on CryptoLaw, Deaton said the SEC had claimed that the only region their claims could be heard would be in the Southern District of New York. According to him, Ripple Labs, Brad Garlinghouse, and Chris Larsen, the accused, were defending themselves, and it is up to affected investors of XRP to speak up and be heard.
He also said that the SEC’s action against Ripple Labs had seen investors incur $15 billion worth of losses, days after the lawsuit was initiated. If his requests are granted, we may likely see a new twist to the SEC vs. Ripple narrative.
SEC’s Lawsuit Snowballs
Ripple’s XRP price had slumped from a high $0.76 to a meager $0.18 two weeks into the case.
To further compound the blockchain company’s misfortunes, major crypto exchanges like Coinbase, Binance.US, eToro, Bittrex, and OKCoin delisted XRP from their platforms. Digital asset management firm Grayscale also liquidated its XRP holdings and channeled the funds into Bitcoin and Litecoin.
Ripple also lost its multi-year partnership with US payments giant MoneyGram after the company announced in its quarterly outlook that it would not be expecting any market development fees from the blockchain company in Q1 2021.
Ripple and Garlinghouse have since replied to the SEC in separate filings made to the courts. Ripple Labs presented a point-for-point response to the SEC's allegations that it engaged in sales of unregulated securities in 2013. Garlinghouse said in a separate motion that the SEC was over-reaching in classifying XRP as a security. According to the Ripple Labs' CEO, the SEC's lawsuit can only be termed prejudiced and not based on facts.