Amid the continuing legal dispute between Ripple and the SEC, pro-XRP attorney Bill Morgan has clarified some vital information about Ripple’s On-Demand Liquidity (ODL) contracts. These disclosures are being made as interested parties try to understand better the legal ramifications of Ripple’s business practices and the lawsuit’s potential outcome.
Along with the Ripple executives, several legal experts have voiced hope over the ongoing litigation, pointing to the SEC’s weaker justifications in their Remedies Phase reply.
XRP Attorney Reveals Specifics of the Ripple ODL Contract
Bill Morgan, an attorney for XRP, recently answered questions about the details of Ripple’s 2020 ODL contract with an Australian client. Morgan claims that the contract has several vital clauses, such as transferring XRP into the buyer’s chosen account, converting XRP to USD at market rates, and limiting usage of the XRP acquired.
The contract notably names New York, USA, as the jurisdiction, which begs whether it complies with legal frameworks and the Howey test.
Meanwhile, Morgan’s analysis raises significant doubts concerning the ODL contract’s compliance with securities laws. He specifically mentioned the Howey test, which establishes whether a transaction qualifies as an investment contract.
Furthermore, including clauses addressing usage restrictions and profit expectations makes Ripple’s legal defense against the SEC’s allegations more complex. Furthermore, jurisdictional differences between contractual terms and operational scope may further complicate Ripple’s regulatory position and any legal responsibilities.
Legal Implications and Future Actions
Commenting on Morgan’s findings, noted crypto lawyer James Murphy, known as MetaLawMan, expressed skepticism regarding the ODL contract’s compliance with the Howey test. Murphy outlined possible legal grounds for Ripple’s challenge, speculating that differences between regulatory requirements and contractual obligations would lead to appeals and calculated legal maneuvers.
In the meanwhile, these revelations highlight how crucial Ripple’s contractual agreements are to determining its legal approach and managing regulatory attention.
Aware of the legal and regulatory obstacles that Ripple still faces, interested parties keep a careful eye on developments about its ODL contracts and how they may affect the cryptocurrency market as a whole. The point of convergence between contractual clauses, regulatory statutes, and legal precedents continues to be crucial in determining Ripple’s legal position and the course of its ongoing litigation against the SEC.
James Murphy, however, recently attacked the U.S. SEC’s reply brief, saying it was devoid of information regarding institutional investor harm claims. Citing damages to investors, the SEC demands $876 million in disgorgement from Ripple Labs; however, the company objects, citing precedent from the Govil case. Murphy casts doubt on the SEC’s reading of SEC v. iFresh and draws attention to its reliance.
Meanwhile, the SEC says institutional buyers experienced harm owing to XRP price manipulation, an allegation Ripple refutes. However, MetaLawMan finds fault with the iFresh ruling, highlighting inconsistencies with Govil’s disgorgement principles.
Amid the legal concerns, the XRP price resumed its downward slide, shedding 2.27% to $0.5107. Its volume dropped 13.78% to $1 billion in the past 24 hours.
