Ripple received another blow from the court, as the judge denied access to the crypto trading records and holdings of SEC employees
Magistrate Judge Sarah Nitburn has denied Ripple’s request for documents on pre-clearance decisions issued by the US Securities and Exchange Commission regarding cryptocurrency trading as well as employees’ personal belongings.
According to the court, the defendants failed to justify interfering with the employees’ financial conduct.
When it comes to the encrypted property of SEC employees, the judge notes that disclosure of this information is prohibited by Congress in order to protect the privacy of government employees:
Defendants are not entitled to annual SEC employee certifications for XRP purchases, sales and holdings.
As reported by U.Today, Ripple intends to obtain annual certifications for SEC employees that would show how much cryptocurrency they own in total.
In particular, the company wanted to know if employees were able to trade XRP before March 9, 2019, when an official investigation order was issued in the case.
The defendants claimed that individual trading decisions could shed light on the lack of regulatory clarity regarding digital assets. However, the Securities and Exchange Commission argued that its employees’ trade reports were “presumed confidential.”
The judge asserts that the regulator’s pre-clearance process is not relevant to the case because it does not include determining whether a particular cryptocurrency is security. Furthermore, revealing how the acting ethics advisor views each individual decision can lead to “collateral litigation disputes.”
The judge also denied the SEC’s access to the bank records of Ripple CEO Brad Garlinghouse and co-founder Chris Larsen in early April.
