The ongoing legal battle between US Securities and Exchange Commission (SEC) and Ripple has seen a new court ruling. Although the final outcome remains uncertain, valuable insights into possible solutions can be gleaned from other legal disputes involving similar companies.
A chief legal officer of Ripple, Stuart Alderoty, shared in a tweet a significant development that could potentially reshape the interpretation of securities law in the digital age.
Friday is for the legal nerds – yesterday in its Twitter opinion, the Sup Ct made clear that you don’t just mechanically apply factors from an old case. You must adapt them to a new world by looking at the underlying statute and the “soil” of the common law that comes w/ it. 1/2
— Stuart Alderoty (@s_alderoty) May 19, 2023
According to Finbold, Alderoty emphasized that the recent Tweet from the Supreme Court’s opinion, the crucial role of adapting legal factors in previous cases, suits the landscape of the new world. This statement is consistent with Ripple’s central argument that the Howey test and its accompanying legislation should be interpreted within a common law framework.
Ripple takes this acknowledgment as an advantage by the Supreme Court as a strong affirmation of its position. The Howey test is an “investment contract” that requires an investment contract agreement that grants the buyer post-sale rights and imposes corresponding obligations on the seller.
Additionally, the defense lawyer James Filan revealed that both parties had written a joint letter requesting the Court to file a public and unredacted version of the cross-motion for summary judgment, along with accompanying exhibits, including the Hinman materials before June 13, 2023.