- John Deaton said XRP may not pay substantial damages as the SEC’s lawsuit against it comes to a close.
- The SEC is expected to disclose how much they want Ripple to pay in damages by February 12, 2024
- Deaton said the absence of fraud and the fact that 95% of the sales were outside the U.S. put the law on Ripple’s side.
In a recent video, John Deaton, a reputed attorney and host of the YouTube channel CryptoLawTV, predicted Ripple may not pay any substantial damages as the lawsuit against it by the U.S. Securities and Exchange Commission (SEC) gradually ends.
Indeed, Deaton noted that Judge Analisa Torres had issued her scheduling order for the final stage of the trial. He added that, with the schedules, the case could come to a close by July 2024.
According to Deaton, Judge Analisa has asked the SEC to frame the appropriate fine and damages that Ripple must pay. It bears mentioning that the partial victory Ripple secured earlier this year ruled institutional sales of XRP to have violated securities laws.
Following that, Deaton predicted that the award and damages would be based on the $770 million worth of XRP institutional sales. However, Deaton explained that there are technicalities that guide the exact award and damages the SEC could request.
In the video, Deaton references several court decisions that disgorgement awards—the type that applies in this lawsuit—must not exceed the wrongdoer’s net profits. In addition, the lawyer stated that the victims had to have incurred some financial losses.
Deaton compared Ripple’s case with that of defunct crypto exchange FTX and crypto lender Celsius, which involved allegations of fraud. So far, Deaton said there have been no allegations of fraud or damages done to XRP holders against Ripple.
Moreover, Deaton stated that the SEC only has jurisdiction over U.S.-based XRP sales. Ripple has pointed out earlier that 95% of their XRP sales were made outside of the U.S. The crypto lawyer argued that this factor further lessens the chances of a significant fine or damages against Ripple.
Apart from that, Deaton said the SEC must issue a brief by March 13 telling the court what they want. Ripple’s reply to the brief is to come in by April 12, followed by an April 29 deadline for the SEC to respond to Ripple’s opposition.
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