Top US Lawyer Says He Doesn’t See Judge Torres “Buying” One of Ripple’s Arguments

Deaton thinks Judge Torres will not accept one of Ripple’s argument, But he still thinks the company will win the lawsuit.

As the crypto community continues to anticipate Ripple vs. SEC’s summary judgment, CryptoLaw founder attorney John Deaton has identified one of the company’s arguments that may not appeal to the Judge in a podcast with Thinking Crypto.

In Ripple’s summary judgment motion, the company argued that if the SEC’s case theory is granted, the court will indirectly accept that there can be an investment contract without a contract.

Commenting on the case, attorney Deaton said the argument by Ripple is only stronger in the Second Circuit than in the First, Fifth, and Ninth Circuits. The CryptoLaw founder noted that other courts outside the Second Circuit had found an investment contract without an underlying one. 

He pointed out that some judges have found an investment contract from a company’s brochure to investors that made promises. It bears mentioning that the leading Silicon Valley blockchain company sent a brochure to about 100 potential investors in 2014. 

According to attorney Deaton, Judge Torres could find Ripple’s approach as an “offering.” Although Ripple argued that the transaction did not constitute an investment contract as there was no underlying contract, Deaton asserted that Judge Torres might not buy the argument. He, however, thinks the Supreme Court will accept the argument. 

“Ripple’s argument is that that is not enough because there is no underlying contract. I don’t see Judge Torres buying that argument although I see the Supreme Court accepting it.”

Despite commending the argument, he believes Judge Torres will not accept it just like other judges at her level had done in the past. 

“I think they’re gonna lose that argument with her. I hope I’m wrong,” Deaton was quoted as saying. 

Attorney Deaton thinks Judge Torres’ summary judgment will favor Ripple. Deaton explained that Ripple would win the lawsuit because the SEC’s theory is too broad. 

“So if I had to pick one winner, if you said who’s gonna win, an outright win, SEC or Ripple, I would pick Ripple unopposed. A lot of people don’t agree with me, but I’d pick Ripple because the SEC’s theory is too overbroad,” he said. 

Judge Torres Could Rule Before May 6

Meanwhile, Deaton speculated that Judge Torres’ summary judgment ruling might come before May 6. He added that it is also possible for the ruling to delay until June 1, as it is difficult to predict. 

“So I’ve been telling people that somewhere between March 6th and May 6th, we’ll get the ruling, right? It could be today while we’re talking, it could be filed, or it could be, you know, May 6th. Now, is it possible that it could go to June 1st? It’s possible, right, we don’t know,” he said.

For Deaton, the only people who can correctly predict the ruling date are Judge Torres’ staff and court clerks who helped her get research materials.