Crypto lawyer John Deaton recently lauded Ripple Inc. for its handling of the enforcement action initiated by the Securities and Exchange Commission (SEC). Deaton commended Ripple and its executives, who were personally named in the complaint, for standing their ground and fighting the securities regulator’s controversial lawsuit.
Deaton took to X (formerly Twitter) earlier today to acknowledge Ripple’s efforts to curb the SEC’s crackdown:
Stop bowing down to transient regulators. Fight back if you can. Kudos to Ripple and its two executives, sued individually for the sole purpose of intimidation, for not settling like the SEC assumed. https://t.co/E0uMzqBDwM
— John E Deaton (@JohnEDeaton1) August 31, 2023
Stuart Alderoty, the Chief Legal Officer of Ripple, recently told his followers on X that the only way to tackle the malicious enforcement actions mounted by regulators was to face it head-on. The Ripple executive’s comments were in response to a report by WSJ, which stated that SEC Chair Gary Gensler was close to matching the losing legal record of Lina Khan, the Chairperson of the Federal Trade Commission.
Commenting on the regulatory landscape in the United States, Alderoty stated:
Lawyers should never again be told “don’t poke the bear” since it seems that is the only way to stop these unelected bureaucrats from pushing their failed political agendas.
Deaton responded to Alderoty’s tweet by applauding Ripple for pushing back against the SEC’s controversial lawsuit. According to the crypto lawyer, the securities regulator had sued Ripple’s executives to intimidate them. But the executives, namely Chief Executive Brad Garlinghouse and co-founder Chris Larson, refused to settle the lawsuit.
The enforcement action against Ripple was initiated in December 2020, when the SEC accused the blockchain firm of raising $1.3 billion through the unregistered securities offering of XRP. The lawsuit quickly became a closely watched event in the crypto industry, given the legal precedent it would set for similar cases in the future.
On July 13, Judge Analisa Torres handed a partial victory to Ripple after ruling that the programmatic sales (secondary market) of XRP did not qualify as investment contracts and thus were not securities. Earlier this month, the SEC indicated that it would appeal the ruling.
