Pro-ripple lawyer John Deaton has predicted that the controversial Hinman emails and speech drafts will be made public at some point, despite efforts by the Securities Exchange Commission (SEC) to keep them sealed.
In a thread of tweets on Sunday, Deaton also noted that the highly contested documents would be made public regardless of Judge Torres’ decision on whether to seal them.
“If Judge Torres cites to or relies on the emails/drafts in making her decision, I am 75% sure that she will declare them “judicial documents” and order that they be unsealed (but with limited redactions). But even if she doesn’t, the emails and drafts are going to be made public,” said Deaton.
The Hinman Documents refer to a series of internal documents detailing a 2018 speech by William Hinman where he told the audience at a conference that, in his view, ether was not a security. Hinman served as SEC’s Director of the Division of Corporation Finance from 2017 to 2020.
The crypto industry viewed the speech as crucial, given the sale of the initial 60 million Ether was intended to raise funds for the Ethereum Foundation. Since Dec 2020, Ripple has been engaged in a legal dispute with the SEC with the agency claiming that the company sold XRP as unregistered securities. On its part, Ripple has denied these allegations arguing that XRP should be classified as a currency or a commodity, not a security.
In January, the judge ordered the SEC to surrender Hinman’s speech on whether ether is a security to Ripple. However, despite offering, the SEC has been opposing a motion by Ripple to unseal the documents, arguing that they contain confidential and privileged information that could harm the agency’s ability to carry out its regulatory duties.
According to Deaton, however, the said documents are too important, not only to the Ripple case but also to the entire crypto industry. The lawyer predicted that more enforcement actions would be filed against crypto exchanges such as Coinbase and Binance for allegedly selling unregistered securities, which, per him, would lead to them being unsealed.
“You don’t think they will seek to get these emails and drafts to help with their defence? There are orders already in place that have denied any privilege claims,” Deaton said, adding, “If you have an ERC20 token, governed by the Ethereum Blockchain, you want those emails…The bottom line is, with all this future litigation, these emails will make it to the public.”
Deaton’s position has been echoed by other members of the cryptocurrency community, who argue that the SEC’s lack of clarity regarding the regulatory status of cryptocurrencies has created confusion and hindered innovation in the industry. Meanwhile, with the matter currently being litigated in court, it remains to be seen whether the documents will be made public.
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