Jeremy Hogan, a well-known attorney in the XRP community, recently engaged in a discussion on social media about the ongoing legal battle between the Securities and Exchange Commission (SEC) and Ripple, offering insights into the potential financial repercussions for the fintech company. The conversation arose in response to comments made by fellow pro-XRP attorney John E. Deaton, who argued that Ripple had a significant legal victory in the case.
In his typical humorous style, Hogan compared his thoughts on the case to resolving a marital disagreement, jokingly stating that he was thinking about “damages” after a small argument with his wife. He then delved into the legal aspects surrounding Ripple and explained that the SEC has the authority to seek “disgorgement,” penalties, and interest from rule violators like Ripple. Hogan clarified that disgorgement involves removing profits gained from violating securities laws, and in the Ripple case, the court identified around $770 million in inappropriate XRP sales to institutional investors.
Hogan went on to discuss several key arguments that could work in Ripple’s favor. Referring to the SEC v. Liu case, he pointed out that disgorgement is an equitable remedy, which means it should be fair. In this context, “fair” would imply that only the violator’s net profits, rather than gross profits, should be considered in calculating the disgorgement amount. This suggests that Ripple may be able to significantly reduce its liabilities by deducting business expenses from the total sales.
Furthermore, Hogan addressed the definition of “victims” in relation to disgorgement, stating that recent court cases have upheld that the amount of disgorgement should be awarded to individuals or entities who lost money on an investment. He highlighted the unusual situation where the value of XRP actually rose during the litigation process, which could potentially indicate that XRP is not a security.
Related Post
Another crucial point Hogan raised was the jurisdictional reach of the SEC. He explained that the SEC would have to prove a connection between the purchaser of XRP and the United States to establish jurisdiction. Therefore, sales to foreign entities without any ties to the US could potentially be exempt from the SEC’s claims. Hogan stated that the question of “nexus” would be interesting to explore in this case.
In discussing the SEC’s perspective, Hogan mentioned that the SEC doesn’t necessarily have to provide specific evidence of the disgorgement damages. Instead, they can give the court a ballpark estimate, and then the burden shifts to the defendant (Ripple) to prove otherwise.
Hogan also acknowledged the possibility of the SEC challenging certain expenses included in Ripple’s profit calculations, particularly those related to legal violations. He anticipated that these issues would be subjects of litigation in the coming years.
Wrapping up his analysis, Hogan estimated that the actual penalty for Ripple would be significantly lower than the initially identified $770 million. Speculating on the expected settlement figure, he suggested that it could be under $100 million, but emphasized that there is still a lot of litigation and information to come out before a final settlement is reached.
At the time of writing, XRP was trading at $0.6703. The overall outcome of the SEC vs. Ripple case remains uncertain, and the final financial repercussions for Ripple are yet to be determined.
In conclusion, Jeremy Hogan, a prominent attorney in the XRP community, engaged in a discussion about the SEC vs. Ripple case, offering insights into potential financial repercussions for Ripple. He highlighted key arguments that could work in Ripple’s favor, such as the definition of disgorgement and the jurisdictional reach of the SEC. Hogan estimated that the actual penalty for Ripple would likely be significantly lower than the initial amount identified, but emphasized that more litigation and information are needed before a final settlement is reached. The outcome of the case and its impact on Ripple’s future are still uncertain at this point.
