XRP Lawsuit: The DPP Dispute is Back, Here’s How It May Ravage Ripple’s Former Win

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XRP Lawsuit: The DPP Dispute is Back, Here’s How It May Ravage Ripple’s Former Win

The latest update in the XRP lawsuit saw both parties submit supplemental briefs on Deliberative Process Privilege (DPP) in the Defendant’s Motion to Compel Discovery, referring to the Second Circuit’s decision in the case of Natural Resources Defense Council v. EPA (NRDC). The NRDC case’s verdict has restructured the scope of DPP, further gravitating the XRP lawsuit in favour of the SEC, particularly over the documents submitted for in camera review.

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SEC Seeks DPP Yet Again

SEC noted that according to the NRDC decision, the agency is not required to connect its records to a “single, discrete decision” to seek protection under DPP. Rather, the decision clarified that the SEC has the right to identify a broader “decisionmaking process” to which the records relate, instead of limiting it to an identified decision. Therefore, the plaintiff in the XRP lawsuit may now be allowed to seek protection for the three additional documents that were submitted by the SEC for in-camera review, given they fall under “consultative process”.

“Because all of the withheld documents are connected to an identified decision or decisionmaking process, the DPP protects them all from disclosure.”, wrote the SEC.

 

Additionally, the SEC asserted that according to the NRDC decision, DPP is also applied to “messaging records,” defined as “records relating to an agency’s decision about how to communicate its policies to people outside the agency”. The plaintiff’s internal communications about content of speeches and other public-facing communications are “messaging records”, and henceforth, protected by the DPP. Furthermore, they need not be related to “a finalized policy or to one not yet conclusively determined.”

“An agency “exercises ‘policy-oriented judgment’ when communicating its policies to people outside the agency” and therefore those “records reflecting deliberations—as opposed to merely descriptive discussions—regarding those decisions are protected by the [DPP].””, the SEC added.

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Ripple Contends DPP Protection Appeal by the SEC

Ripple contended DPP protection for the SEC, arguing that according to the NRDC decision, government agencies, such as the SEC in the XRP lawsuit are responsible for connecting a withheld document to a “specific decision” or “specific decision making process”, which the SEC has failed to accomplish.

According to Ripple, the SEC never stated that it had commenced a policy process addressing whether to regulate digital assets as securities. Henceforth, the defendants claimed that the plaintiff has failed to identify any definable decision or decision making making in the first place, leaving it ineligible for protection under the updated scope of DPP.

“The SEC’s theory of this case has been that digital assets like XRP are plainly securities under 75-year-old judicial precedent, rendering policy-making unnecessary.”, wrote Ripple.

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