“Even thinking about appealing this Order suggests to me that the SEC is desperate for this Deposition not to go forward. Desperate”
Ripple has scored a major win yesterday, with the court ordering the deposition of ex-SEC Director William Hinman. The exceptional circumstances that allow for the deposition of a high-ranking officer are the uniqueness of the lawsuit and the extraordinary public interest.
On the side of the agency was a new counsel, Ms. Stewart, instead of Jorge Tenreiro, who has been leading the plaintiff’s arguments.
Ms. Stewart was the one who had to explain to the Judge why the SEC says privilege would be breached if the scheduled deposition is about a public speech based on William Hinman’s personal views and not on behalf of the SEC.
Privileged as “deliberative”, she answered, adding that the deliberative process privilege would be invoked if Hinman was deposed.
When Judge Sarah Netburn ruled to allow for the deposition on Monday, the SEC said it “would need time to evaluate that”.
“That can mean only thing: absent an agreement between the parties, the SEC intends to appeal the ruling allowing the deposition to go forward. And it’s almost never done”, attorney Jeremy Hogan commented the hearing in a video.
“Even thinking about appealing this Order suggests to me that the SEC is desperate for this Deposition not to go forward. Desperate. Why exactly they are desperate I do not know. But there is something there that is not just “normal” bad for them but really really bad for them”.
Will Ripple be able to unearth it? “I don’t know the answer to that but what I do know is that this fight is far from over”, Mr. Hogan said, adding that soon we’ll be seeing this issue in front of the Judge.
Attorney John E. Deaton, another popular figure within the XRP community, has suggested a line of questioning for the deposition, which includes Hinman’s relations with Ethereum via law firm Simpson Thatcher, which raises questions of conflict of interest.
Deaton also puts into question the idea that Hinman’s speech was just a personal opinion and not policy, since he never personally corrected the record and even used the term “we” in a later interview.
“And now both Hinman and the SEC want us to believe the ETH speech should never have been interpreted as policy or any kind of notice about ETH’s status, in the same way that the SEC argued in the Ripple complaint in December 2020 that all of us should have known XRP was a security since 2013.”
In regard to the Judge’s ruling, John Deaton said on Twitter: “The fight over the Hinman deposition has now just begun. It will be a heated “meet and confer” meeting I can promise you that. If I was a lawyer for Ripple, I would find out immediately if the SEC intends to object to several basic non-privileged questions”, as he provided ten questions as an example.
“1) how many drafts did the speech undergo; 2) who helped draft or compose the speech; 3) who reviewed the speech before you gave it; 4) did you submit the speech to any of the commissioners or Chairman; 5) anyone outside of the SEC assist you; 6) what research, articles, publications or technical resources did you review before giving the speech; 7) what input did the founder of the ETH foundation provide you before reaching your opinion; 8) what other digital assets did you review or compare to ETH before speech; 9) did you send any emails or messages with any lawyers or staff at Simpson Thatcher before giving that speech; 10) list each person you spoke to about the speech before giving it; etc Notice I haven’t asked what was said yet so there is no privilege argument.”
“But if the SEC is going to object to these basic questions, I would go to the Judge and ask the Judge to appoint a Special Master (ie the Judge herself or a retired Judge) to preside over the deposition and rule on objections live on the spot”, Deaton concluded.