Pro-Ripple lawyer predicts protracted legal battle, hints at settlement conditions

Pro-Ripple lawyer John Deaton said that he expects a long legal process between the United States Securities and Exchange Commission (SEC) and the Ripple case – possibly a year. Deaton indicated that a settlement could only be considered if Coinbase's motion to dismiss the SEC's case against him is successful.

In a detailed post on X (formerly Twitter), Deaton discussed the lack of serious settlement talks between Ripple, its executives and the SEC. He explained the complexities of the penalty phase, which included a $770 million fine and various legal proceedings, referring to the SEC's interest. he said:

“I don't believe there was a single serious discussion about the deal between Ripple, Brad Garlinghouse, Chris Larsen and the SEC. The SEC is upset and embarrassed and wants $770M in meat.”

He explained that the penalty phase is a detailed process similar to the second legal case, which includes deposits, document requests, emails, financial records, contracts and order-based liquidation (ODL) transactions. Deaton suggests that Ripple may seek to mitigate the $770 million fine by avoiding ODL transactions and reducing additional costs. He points to the LBRY case, where the SEC initially pursued $23 million but, after eight months of litigation, settled for a $130,000 fine.

As I said yesterday on @CryptoLawUS TV with @attorneyjeremy1 and Thien-Vu, I don't believe there has been a single serious discussion between @Ripple @bgarlinghouse @chrislarsensf and @SECGov about a settlement.

The SEC is upset and embarrassed and wants $770M worth… https://t.co/kcXvsrPgaa

— John E. Deaton (@JohnEDeaton1) October 25, 2023

Creating a timeline, Deaton said.

“I don't expect the final ruling by Judge Torres until late summer, at the earliest. It can literally take a year before an appeal can be filed in this case.

Deaton linked the outcome of Ripple's case with the SEC's lawsuit against Coinbase, stating that if the exchange succeeds in its motion to dismiss, the SEC may change its position on cryptocurrencies and consider an agreement with Ripple. However, if Coinbase's move fails, it doesn't foresee a settlement.

Related: Coinbase defies SEC's crypto authority in latest bid to drop regulator's suit

Oral argument on Coinbase's motion is scheduled for January 17, 2024, and a decision could follow within 60-120 days. Ripple is expected to face significant legal costs during this period as it tries to reduce the $770 million fine.

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