Attorney John Deaton, who represented thousands of XRP holders during the Securities and Exchange Commission lawsuit against Ripple Labs, has stated that nearly 4,000 individual affidavits from XRP holders played a crucial role in the court’s ruling that XRP is not inherently a security.
Speaking about the landmark 2023 decision by Judge Analisa Torres, Deaton highlighted that the court specifically cited the affidavits in its ruling. The judge referenced the submissions when determining that XRP purchases on public exchanges did not meet the legal definition of an investment contract under the Howey Test, a key factor in the partial summary judgment victory for Ripple.
The affidavits were collected through Deaton’s advocacy efforts, which mobilized a broad coalition of retail XRP investors who felt their interests were not being represented in the SEC’s enforcement action. Many of these holders had purchased XRP years before the SEC filed its lawsuit in December 2020 and argued that they had no reasonable expectation of profits derived from Ripple’s efforts alone.
Deaton’s comments serve as a reminder of the human element in what was primarily a legal and regulatory battle. The case established important precedent for how digital assets are classified under U.S. securities law, with Judge Torres ruling that programmatic sales of XRP to retail investors through exchanges did not constitute securities transactions, while institutional sales did.
The SEC’s lawsuit against Ripple was filed in the final weeks of the Trump administration and continued through the Biden administration, becoming the most closely watched legal case in the cryptocurrency industry before its partial resolution.
This article was adapted from BeInCrypto. Read the original here.
