SEC vs. Ripple: Attorney Deaton files for intervention by XRP holders as third-party defendants

  • John E. Deaton filed a motion to intervene in the Ripple case against the SEC yesterday on behalf of 6,000 XRP investors to date.
  • If the motion is approved by Judge Torres, XRP holders will be able to appear as third-party defendants in the lawsuit.

As CNF reported, John E. Deaton’s petition on behalf of all XRP holders against the U.S. Securities and Exchange Commission (SEC) gained significant attention and prominence in recent days. With his petition, Deaton has not only exposed the inconsistency and ambiguity of the SEC in its reasoning, but now also applies to become “part” of the SEC lawsuit to give XRP investors a voice.

To that end, Deaton, a managing partner at the law firm, yesterday filed a “pro hac vice motion and motion to intervene on behalf of XRP Holders” in Ripple’s litigation with the SEC yesterday. In the letter to Judge Analisa Torres, Deaton says he was contacted by more than 6,000 members of the community:

The Proposed Intervenors, XRP Holders, are one group of the nonparties referenced in Ripple’s Answer. Although I have not been contacted by millions of XRP holders referenced in Ripple’s answer, I have been contacted by well over six-thousand of those XRP holders requesting that their individual and collective voices be heard.

If Judge Torres’ motion is approved, XRP holders, represented by Deaton, will be able to appear as third-party defendants in the case between Ripple and the SEC to protect their own interests.

Will Deaton tip the scales for Ripple and XRP?

As stated in a press release on Deaton’s website CryptoLaw, the SEC lawsuit against Ripple and its executives has caused over $15 billion in losses for XRP holders. Deaton therefore filed a petition for a Writ of Mandamus in federal district court in Rhode Island on January 1, 2021, urging the SEC to amend its complaint to limit the impact on XRP holders.

On March 5, the SEC responded with a motion to dismiss the petition, reasoning that “the U.S. District Court for the Southern District of New York is the only forum” to determine XRP’s status as a security or non-security. Therefore, Deaton now moves to intervene:

If the Southern District of New York is the exclusive venue for decisions that have already proven to have a massive impact on XRP holders and are likely to set the course for the future of all cryptocurrencies in the U.S., then that’s where we must go. […]

Ripple, Larsen and Garlinghouse are focused on defending their interests against the SEC’s attack, and the $1.3 billion the agency requested from them in damages. It’s not up to them to defend mine, or the interests of any other XRP holders.  We didn’t buy XRP from them, nor did we consider Ripple’s success as a company when we bought it. It’s up to us to defend ourselves against the SEC.

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