US Attorney Bill Morgan and XRP YouTuber Moon Lambo challenge the SEC’s claims of XRP investor harm, while questions about the agency’s ability to seek disgorgement loom after the SEC v Govil decision. Attorney Steven Neyaroff adds a twist by suggesting penalties for the agency itself, raising speculation about the SEC’s case against Ripple.
Renowned US Attorney Bill Morgan has raised concerns about the evidence presented by the SEC to support its claim that XRP institutional investors suffered financial harm. Morgan argues that the equitable remedy should compensate victims, not provide windfalls to the SEC or the government.
SEC v Gorvil involved fraud. This passage is clear. The equitable remedy is discretionary and meant to compensate victims not give the SEC/Govt a windfall. What evidence before Torres, expert or otherwise, will show actual financial harm to institutional investors. /1 https://t.co/vN77P5bKdu pic.twitter.com/O1b4V7ua7s
— bill morgan (@Belisarius2020) November 4, 2023
Ripple’s Defender – XRP YouTuber and the SEC’s Challenge
Moon Lambo, an XRP YouTuber, has echoed doubts, suggesting that XRP holders weren’t harmed by Ripple, despite the SEC’s arguments. This could spell another setback for the SEC, as Ripple’s Chief Legal Officer, Stuart Alderoty, points out that the SEC cannot seek a crippling disgorgement award without first proving actual financial harm to “investors.”
The case has captured the attention of legal experts, including Steven Neyaroff, the Inventor of Utility Token, who raises the intriguing idea that the SEC could be held accountable for pecuniary harm resulting from its actions. Neyaroff emphasizes that if the agency’s actions are deemed arbitrary and capricious, penalties should be imposed. This opens the debate on “qualified immunity” for agency officials who act maliciously.
Hurdles for the SEC
Following the SEC v Govil decision, there are speculations that the SEC may face another hurdle in its case against Ripple. In the remedies stage, the SEC needs to demonstrate that XRP holders suffered losses due to their investment before Ripple can be held liable. Attorney Jeremy Hogan highlights the challenge, noting that investors who purchased Ripple at a lower price have not incurred any financial damage.