A crypto legal specialist believes a total triumph for Ripple over the U.S. Securities and Exchange Commission (SEC) is the most probable result of the XRP dispute.
In late 2020, the SEC accused Ripple of dispatching the crypto resource XRP without registering it as a security.
Jeremy Hogan, an attorney whose YouTube channel has 157,000 subscribers, believes that Ripple will emerge victorious in the summary judgment, since XRP was not sold as a security.
He states that there are two reasons why this could be the case, the first being that Ripple had no legal responsibility to buyers after the sale of XRP.
Hogan refers to an amicus brief filed by Paradigm Operations, an investment firm specializing in cryptocurrency, to back up his point.
According to the brief, a law firm that the company hired conducted an examination of 266 court cases involving securities violations.
The brief goes on to state on page two: “A thorough study of federal and appellate law demonstrates that there is no basis for the SEC’s attempt to apply the Howey analysis of an investment contract to the underlying asset. In all instances when an investment contract was found to exist, there was a legal connection between the supposed issuer and the investor providing investment capital.”
Hogan emphasizes that the law necessitates an “investment contract” rather than a “sales contract”.
He explains that Ripple sold XRP with no legal commitment to do anything else, which is the selling of an asset and not a security.
Then, the lawyer concentrates on the second part of the Howey test, which states that an investment contract is formed if there is a common enterprise.
The crypto legal specialist states that the SEC has three major issues in this area.