Deaton Dismisses Settlement Rumors with SEC in the Ripple vs SEC Lawsuit
In a recent live stream, attorney John Deaton, a prominent advocate for XRP, rejected claims of ongoing settlement discussions between Ripple and the Securities and Exchange Commission (SEC) amid the SEC’s motion to compel financial statements. Deaton described the current legal proceedings as “scorched earth litigation.”
Deaton firmly stated that there are currently no talks of a settlement between Ripple and the SEC. This assertion was based on the SEC’s recent motion, which requested Ripple to provide audited financial statements from 2022 to 2023 and post-complaint contracts overseeing institutional sales.
Regarding the possibility of a future settlement, Deaton expressed his thoughts. Although he currently believes that no discussions are taking place, he acknowledged that a settlement could occur later on. Deaton explained that the SEC might be inclined to settle if they believe they can obtain more favorable terms compared to a court decision.
Deaton stated, “Maybe that will prompt them (SEC) to come to the table because they can spin it as opposed to receiving another ruling that damages their reputation as an organization. I’m not saying that a settlement cannot or will not happen. I’m simply telling you that it is not happening today.” This indicates that while an agreement is possible, it is not currently in progress.
As the lawsuit progresses to the remedies stage, there is speculation about the potential fines Ripple may face for alleged violations related to institutional sales. Deaton discussed the SEC’s interest in examining Ripple’s financial records and post-complaint contracts. He believes that Ripple may demonstrate that most institutional sales were conducted appropriately, resulting in fines ranging from $10 million to $100 million. Deaton highlighted that these fines may be significantly less than the $200 million Ripple spent on legal defense, as stated by Ripple CEO Brad Garlinghouse.
Deaton’s perspective extends beyond the ongoing trial, contemplating the potential outcomes if an appeal is made. He is confident that the Second Circuit, a higher court, would support Judge Analisa Torres’s decision to dismiss the case early. Deaton emphasized the strength of Torres’s rulings concerning programmatic sales and the distribution of XRP, suggesting that these decisions would likely withstand an appeal attempt.