27. February 2024

• Judge Analisa Torres has issued a 57-page ruling on both Ripple Labs and the U.S. Securities and Exchange Commission (SEC)’s motions to exclude expert testimony from summary judgment (“Daubert” motions).
• Neither side wins as their motions are granted in part and denied in part.
• The SEC’s motion to include expert witness number 1 is denied, while the motion to include expert witness number 3 is granted, with the judge acknowledging that it is directly relevant to the final element of the Howey test for an investment contract.

Initial Ruling Issued

In the legal dispute between the U.S. Securities and Exchange Commission (SEC) and Ripple Labs, Judge Analisa Torres has issued an initial ruling, but it is not the summary judgment ruling. Instead, the judge has issued a 57-page ruling on both parties’ motions to exclude expert testimony from summary judgment (“Daubert” motions). At first glance, neither Ripple nor the SEC wins. The SEC’s motions are granted in part and denied in part, and Ripple’s motions are granted in part and denied in part.

What This Ruling Means for Ripple

Scott Chamberlain, a former attorney and co-founder of Evernode XRPL, stated that “Neither side gets everything it asked for because neither side had impeccable arguments for everything it wanted.” The win goes to Ripple when it comes to one of the most important outcomes of this ruling – exclusion of Patrick Doody as an expert witness of SEC which was hired to analyze expectations of XRP buyers. Moreover Jeremy Hogan commented on twitter that now SEC must prove that investors had reasonable expectation of profit from Ripple’s efforts or who will testify?

Ruling On Expert Witnesses

The motion by SEC to include Patrick Doody as an expert witness was denied whereas Motion by Ripple on third Expert Witness was granted with judge acknowledging its relevance towards last element of Howey Test for Investment Contract but Jeremy Hogan still thinks this evidence might not be strong enough for proving reasonable reliance case.

Conclusion

The outcome shows that no clear winner or loser can be derived from this ruling as none got exactly what they asked for due to lack of impeccable arguments from either sides , however small victory goes out towards ripple excluding one crucial expert witness which could prove harmful towards their case if included .

Takeaways

This decision gives us insight into how rigorous & impartial Judge Torres is while dealing with cases like these & also shows how careful both parties need to be while providing arguments & evidence against each other during proceedings like these .