SNEAK PEEK
- Torres meticulously applied the Howey test to SEC-defined XRP sales.
- Institutional and programmatic sales present notably different factual settings.
- The reasonable investor’s expectations vary across Ripple sales categories.
In a significant revelation, Judge Torres’s thorough probe into Ripple’s XRP sales was far from arbitrary. Inspired by the Securities and Exchange Commission (SEC)’s presentation, she astutely delineated the complex process. Specifically, she separated and applied the famed Howey test to each type of sale defined by the SEC.
Excellent ? explaining that Torres didn’t make a distinction between the different sales out of thin air. She took each type of sale CHOSEN and DEFINED by the SEC and applied the Howey test. I’m willing to bet significant funds she doesn’t get reversed on appeal. https://t.co/5jAfwusrng
— John E Deaton (@JohnEDeaton1) August 6, 2023
By doing this, she made an astute decision, an approach that many legal experts, including attorney John E Deaton, found fair and accurate. Besides, Deaton predicts that the likelihood of her judgment being overturned on appeal is low. Additionally, the efficiency of her approach is commendable, applying due analysis to each category as proposed by the SEC, bringing fairness to the forefront.
Significantly, Judge Torres identified the substantial differences between institutional and programmatic sales. She noted that institutional buyers signed contracts with Ripple, which was not the case for programmatic sales. Moreover, Ripple could not identify the buyers, and buyers were clueless about the seller in programmatic sales.
Further, she deduced that Ripple made no promises to programmatic buyers. Furthermore, she determined that these buyers didn’t expect profits from Ripple’s efforts but instead relied on other factors.
Another difference is that Ripple did not know who were buyers and the buyers did not know Ripple was the seller in programmatic sales. Programmatic buyers did not know to whom they were paying their money. /8
— bill morgan (@Belisarius2020) August 6, 2023
Hence, she aptly noted that the ‘factual setting as a whole’ differed between institutional and programmatic sales. Consequently, she concluded that the reasonable investor’s expectations varied greatly in the diverse set of facts present in the different Ripple sales categories.:
In conclusion, the Torres decision showcases an exemplary case of legal analysis in action. Each transaction was scrutinized under the lens of its unique circumstances, setting a potentially powerful precedent in the realm of securities law. It’s a hard blow for the SEC; however, it affirms the precision and thoroughness of our legal system, making it a landmark case to watch.
