SEC prevailed in their legal battle against LBRY just a month ago. John E. Deaton, a crypto lawyer and the inventor of Crypto-Law, has started a thread on Twitter in which he explains whether or not the same result would occur in the case of SEC vs. Ripple.
The attorney began by stating that the majority of the individuals who believe that Ripple will likewise lose are those who have not read a single brief in the case, and the individuals who have read a brief in the case have only read the SEC’s most recent brief.
Deaton said that Ripple is playing the long game but still has high hopes of winning in the District Court. Ripple contends that the word “scheme” employed by the Supreme Court in the case of Howey applies ONLY after the Court had FIRST determined that an underlying contract does exist.
In his words:
“I don’t believe Judge Torres is going to agree with that argument. It would require her to believe Judge Castel was wrong in Telegram as well as several appellate courts. Ripple’s best chances at winning at THIS LEVEL is with a strict Howey analysis – which brings us to LBRY.”
The Ripple case is in the 2nd Circuit. However, LBRY is not. Furthermore, LBRY did not challenge the common enterprise element; nevertheless, Ripple and XRP holders, who were awarded Amicus by the Judge over a year before any other Amici entered, vehemently challenge the common enterprise prong of Howey.
Deaton made it clear that XRP holders are not in business with Ripple or even with each other. Evidence of this may be seen in the Celsius Bankruptcy. Those who had lent XRP to Celsius lost money, while the rest of the XRP community was unaffected.