The Legal counsel of Ripple Executive Chair Chris Larsen is trying to get his name removed from the US SEC’s lawsuit against the company. The lawsuit is over the sale of XRP which is alleged to be an unregistered security.
The letter to Judge Analisa Torres filed a motion to dismiss charges against Larsen. It also questioned the merits of the SEC’s allegations.
The letter stated, “Defendants believe that the SEC will be unable to demonstrate that transactions in XRP constitute securities because, among other reasons, they possess none of the attributes of ‘investment contracts’.”
SEC Failed To Establish XRP Being A Security
The letter also noted that the SEC failed to establish Larsen’s knowledge of XRP being security while selling them. “At a minimum, the SEC must allege that it was ‘so obvious’ that XRP transactions were securities and Ripple’s conduct was improper that Mr. Larsen ‘must have been aware of it’.”
The lawyer additionally argued that claims against Chris Larsen are barred by the five-year statute of limitations. “SEC has alleged that Mr. Larsen’s sales were part of a single ‘ongoing’ Section 5 violation that began in 2013.”
The lawyer would continue on. “Because the SEC has alleged that the sales of XRP over a multi-year period constituted only one offer, which began in 2013, the statute of limitations began to run in 2013 and expired in 2018.”
The lawyers also questioned the SEC’s jurisdictional authority. They believe the allegations failed to establish that the XRP tokens were sold in the US.
This motion comes after a similar one was filed on behalf of co-defendant Brad Garlinghouse. That motion also asked for the case to be dismissed.
The lawyers ended the letter with a strong statement. “In the face of these undisputed facts, which affirmatively establish the absence of knowledge or recklessness, the SEC offers only conclusory and legally insufficient allegations that Mr. Larsen knew or recklessly disregarded that Ripple’s conduct was in any way improper.”