Ex-SEC Director Says XRP Investors’ Civil Lawsuit Against SEC Is “a Losing Case”

Former SEC director Marc Fagel says XRP investors’ lawsuit against SEC will fail under current law.

It is common knowledge that many XRP investors suffered huge losses due to the SEC’s lawsuit against Ripple. Recall that, in December 2020; the commission charged Ripple with offering unregistered securities – XRP.

The lawsuit caused the value of XRP to plunge, with investors suffering huge financial losses. Notably, XRP investors are yet to recover from the incident. Consequently, they have discussed the likelihood of filing a civil suit against the SEC.

Fagel Shares His Perspective on the Matter

In a recent Twitter exchange, an XRP enthusiast (SuitPotato) asked the former director of SEC’s San Francisco division Marc Fagel to share his thoughts on the development.

“Marc, serious question. What are your thoughts on us buyers putting together a civil suit against the SEC for causing financial damages to us retail holders if the judge rules in favor of Ripple?” the XRP holder quizzed.

In response, Fagel said a lawsuit from U.S. investors against the SEC is a losing case under current law. Furthermore, he noted that such a lawsuit could also attract sanctions to the lawyer who filed it.

Although Fagel thinks people might perceive his opinion as biased, he pointed out that he has litigated against the SEC.

I think that under current law it's a losing case, and arguably one where an attorney filing it would risk sanctions (at least based on the known facts). But that's just one guy's opinion, and people think I'm biased (even though I've personally litigated against the SEC).

— Marc Fagel (@Marc_Fagel) June 23, 2023

Reacting to Fagel’s comment, SuitPotato noted that if the attorney gets sanctioned, the 75K XRP holders, who joined the SEC vs. Ripple legal action as amici, would support the sanctioned attorney.

In response, the former SEC director said there are less risk-averse attorneys who would be willing to take such a case. Additionally, he stressed that the lawsuit would be fun to watch. However, he does not think it would “work out well.”

And I'm sure there are less risk-averse lawyers out there who'd be up for it. It would be fun to watch, but… nope, not gonna work out well.

— Marc Fagel (@Marc_Fagel) June 23, 2023

Fagel Comments on SEC v. Ripple Case

Meanwhile, Fagel has been interacting with XRP community members since the SEC v. Ripple lawsuit began. The former SEC director has engaged in a series of debates with top XRP enthusiasts, including attorneys John Deaton and Jeremy Hogan.

Earlier this month, Fagel joined Deaton and Hogan to discuss the importance of Hinman’s documents to the Ripple lawsuit. Fagel asserted that the emails do not have a “bombshell” to help Ripple win the case.