Brad Garlinghouse Lawyers Requests Documents from Binance in Ongoing Case with SEC

The heated feud between blockchain payments firm Ripple Labs, its executive Brad Garlinghouse, and the United States Securities and Exchange Commission (SEC) which commenced last December, has drafted Binance, the world’s largest crypto exchange.

Per the court documents filed in the Southern District of New York on Monday, Garlinghouse’s lawyers are requesting Binance to provide evidence that would recuse the CEO of selling XRP tokens in the US. 

Garlinghouse’s lawyers want the Cayman Island subsidiary of the trading platform to turn in documents that are “relevant to the case and unobtainable through other means,” citing the laws backed by the US Department of State and the Hague Convention in its request. According to the filings, the lawyers want the court to advise the Central Authority of Cayman Islands to force Binance to release the documents.

Per the court details, Garlinghouse’s defence for seeking the documents is centred on proving that the sales of XRP token the Ripple executive and the firm made were made outside of the United States.

“As the SEC knows, Mr. Garlinghouse’s sales of XRP were overwhelmingly made on digital asset trading platforms outside of the United States […] the discovery that Mr. Garlinghouse seeks will be relevant to demonstrating that the offers and sales that the SEC challenges did not occur in this country and are not subject to the law that the SEC has invoked in this case,” the court filing reads.

The documents, if obtained, may help substantiate the claims that the sales of these tokens are not as securities as the market regulator claimed. Binance has its own struggles with regulators worldwide, and while there is no comment from the exchange per the Garlinghouse request, the platform may experience cold feet in its willingness to be embroiled with the case in any way. 

The Ripple-SEC case is billed to close its pre-trial discovery process by October 15th.

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Ripple seeks docs from 15 offshore exchanges it says could be ‘fatal’ to the SEC’s charges

Ripple CEO Brad Garlinghouse and co-founder Chris Larsen, have filed a motion requesting the U.S. Securities and Exchange Commission investigate Bitfinex’s parent company, iFinex, and 14 other international crypto exchanges.

The June 2 motion requests documents from exchanges including iFinex, Bitforex, Bithumb, Bitlish, BitMart, AscendEX (formerly Bitmax), Bitrue Singapore, Bitstamp, Coinbene, HitBTC, Huobi Global, Korbit, OKEx, Upbit Singapore, and ZB Network Technology

The motion’s supporting memorandum notes the letters of request solicit assistance from authorities in the Cayman Islands, Hong Kong, South Korea, the United Kingdom, Singapore, Seychelles, and Malta.

The SEC’s amended complaint against Ripple accuses Garlinghouse and Larsen of selling more than two billion units of XRP to “public investors” located “all over the world,” with the SEC seeking disgorgement from Ripple’s executives based on the sales.

Ripple’s executives deny the SEC’s allegations they violated Section 5 of the 1933 Securities Act, emphasizing that Section 5 specifically prohibits the domestic sale of securities without a registration statement. Garlinghouse and Larsen’s legal representation counter that their XRP sales were conducted on foreign exchanges and thus outside of the SEC’s jurisdiction:

“In the case of transactions conducted on such foreign trading platforms, both the offers of XRP and the sales of XRP occurred on the books and records of the respective platforms, and therefore geographically outside the United States. The SEC’s failure to allege domestic offers and sales should be fatal to its claims.”

Ripple asserts the exchanges and related entities subject to its new motion “possess unique documents and information” regarding Ripple’s legal battle with the SEC, specifically concerning “the process by which transactions in XRP allegedly conducted by the Individual Defendants on foreign digital asset trading platforms were conducted.”

The SEC amended its complaint against Ripple and the firm’s executives in February, alleging their sales of XRP suppressed the crypto asset’s price. The complaint also accuses Garlinghouse and Larsen of misleading public investors while offloading billions of dollars worth of XRP as Garlinghouse repeatedly claimed he was “very long” on XRP during the time of the alleged sales.

The filing comes just days after a significant blow was dealt to the SEC’s case against Fipple, with the court rejecting the SEC’s bid to access communications between Ripple and its legal counsel.