Attorney and crypto legal expert Jeremy Hogan says Ripple may have to wait a few months before trying to settle their lawsuit with the U.S. Securities and Exchange Commission (SEC)
The SEC sued Ripple late last year for allegedly selling XRP as a security.
In a new video, Hogan notes that the lawsuit’s discovery phase doesn’t end until November 12th, which makes it hard for either party to negotiate a settlement if they still don’t know the extent of the other side’s case.
“The problem with a settlement between now and November 12 is that the parties won’t know how strong each side’s position is until after discovery closes. So even if we are looking at a slap on the wrist settlement of millions of dollars – which is kind of funny to say – how many millions are we talking about? 10? 20? 200? A thousand? You think that Ripple isn’t going to care about the difference between paying $20 million versus $200 million? I think any business cares about that and is willing to wait an extra couple of months in order to potentially save millions of dollars.”
The discovery phase is a period during a trial where one side gathers the facts of the case or evidence from the other party.
Hogan says that the SEC has a lot riding on proving that Ripple had “fair notice,” or prior knowledge that XRP was a security, and likely won’t negotiate a settlement until that motion is seen through.
“I don’t see much impetus for [the SEC] to settle until that hearing is heard. In other words, if they can’t bury the defense, they just turn around and pay which in our case would mean get the case settled. Because what I know for a fact is that Ripple wants this case over with, with the caveat that the markets have to feel comfortable with any settlement and XRP gets re-listed, which means that the ‘problem child’ here is the SEC, and if the SEC’s gambit fails, that’s when the litigation has the best chance at resolving.
Otherwise, we are still looking at the Ripple case reaching the judge on summary judgment in early 2022.”