![]() ![]() Part of the SEC’s case against Ripple - that its executives aided and abetted securities law violations with regards to institutional sales - is still alive after the July 13 ruling, and is set to go to trial in New York. “As our case develops and the motion to dismiss is considered, I think Ripple is clearly going to have an impact,” Bittrex Global CEO Oliver Linch said, adding that the decision “strengthened” his company’s arguments.Īn SEC spokesperson said after the decision that the agency was “pleased” with the court’s ruling that tokens offered and sold by Ripple were investment contracts in certain circumstances. The law firms separately asked a Washington trial court in June to toss the SEC’s claims of violating registration requirements. Lawyers from Quinn Emanuel and King & Spalding have also come to the aid of Bittrex and its foreign affiliate, Bittrex Global. A member of the team representing Binance.US is Milbank partner George Canellos, a former co-director of the SEC enforcement division. The Sullivan & Cromwell partners, each of whom charges north of $2,100 an hour, are working with Wachtell litigation chair William Savitt and partner Sarah Eddy, a former chief of appeals for the Manhattan US attorney’s office.īinance and BAM Trading Services, which operates the Binance.US exchange, has, meanwhile, turned to its own powerful group of firms - Gibson Dunn & Crutcher, Latham & Watkins, Milbank, and WilmerHale. The exchange has hired top Wall Street firms Sullivan & Cromwell and Wachtell Lipton Rosen & Katz, including two former enforcement directors-Steven Peikin of the SEC and James McDonald of the Commodity Futures Trading Commission. and Gemini Trust Co., as well as TerraForm Labs, the company behind the Terra USD stablecoin.Ĭoinbase in April responded to an SEC Wells notice signaling plans for an enforcement action by saying it would “exhaust all avenues” in any showdown with the agency. It has brought additional actions against crypto exchanges Bittrex Inc. The agency has filed lawsuits against Coinbase and Binance, two of the world’s largest crypto platforms, for failing to register as securities exchanges. “I imagine will get the resources to keep up with these large defense firms, given how important this issue is to the SEC.” “The lawyers are going to make more money because the SEC will continue litigating,” Park said. But it will also likely incentivize the SEC to “double down” on its position on what constitutes an investment contract before other court venues, said UCLA law professor James Park. The Ripple decision stalls the momentum the agency built in the preceding months. White and former SEC enforcement director Andrew Ceresney, who is also at Debevoise, along with Cleary Gottlieb partner Matt Solomon, a former SEC chief litigation counsel, are among the attorneys who represented Ripple and its executives. Alderoty turned to an all-star lineup from the law firms Debevoise, Paul Weiss, and Cleary Gottlieb. Ripple’s general counsel, Stuart Alderoty, is a Wall Street veteran who has been the outspoken face of its legal battle with the SEC. “It’s an existential crisis, and that changes the stakes in terms of what you do about litigation and how you lobby,” said Allen. Outside of lawmakers passing new legislation directly addressing the digital assets market, the crypto sector has no other option than to continue investing heavily in a legal defense, said American University law professor Hilary Allen. “As a matter of law, a court has held that crypto assets traded on a platform are not investment contracts.” “It’s a really big chip in the SEC arsenal,” said DeWaal. The payoff is a ruling that should embolden other companies to continue opposing SEC attempts to regulate cryptocurrency as a security, said Gary DeWaal, the former chair of Katten Muchin’s financial markets group. Since facing a lawsuit three years ago, the crypto payments firm hired lawyers including former SEC chair Mary Jo White, now a partner at Debevoise & Plimpton, to battle the US Securities and Exchange Commission. ![]() Ripple claimed late last year to have spent roughly $100 million defending a charge that it raised more than $1 billion through the sale of an unregistered security. ![]() A federal court ruling that the Ripple Labs token is not a security when sold to the general public is likely to embolden the crypto industry to invest heavily in lawyers to fight SEC regulation. ![]()
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