Ripple Labs Inc. has intensified its legal fight against the US Securities and Exchange Commission (SEC) by submitting a detailed letter to the court. This letter aims to challenge the expert testimony submitted by the SEC, raising concerns over the timeliness and disclosure of the evidence.

Dispute over Expert Testimony

The main point of contention revolves around the Declaration of Andrea Fox, which Ripple claims is an expert testimony rather than mere summary evidence as argued by the SEC. Ripple argues that Fox's declaration applies specialized accounting knowledge to evaluate financial statements and make inferences that go beyond basic arithmetic. Ripple asserts that this satisfies the requirements of an expert witness under Federal Rule of Evidence 702(a).

In contrast, the SEC contends that Fox's analysis was a plain summary of Ripple's financial data, which does not require the substantial expertise typical of expert witnesses. They claim that her testimony was designed to facilitate the perception of the data, not to provide expert opinions on financial issues.

Timeliness and Disclosure Disputes

Another crucial concern raised by Ripple is the timeliness of the Fox Declaration. Ripple accuses the SEC of failing to name Fox as an expert witness within the schedules stipulated by the court, which is done to ensure that both parties have a period to respond to the evidence presented during the trial.

Ripple insists that this oversight prevents them from fully conducting a cross-examination and detracts from the fairness of the trial process. The SEC, however, opposes this argument by claiming that Fox did not need to be documented as an expert since she was a summary witness whose testimony was based on pre-existing records and simple calculations.

Precedents and Legal Interpretations

Ripple's reply brief refers to several cases where courts have struck down declarations similar to Fox's as undisclosed expert testimony disguised as fact summary. They contend that prior decisions support their stance that not properly classifying and disclosing the nature of a witness' testimony can mislead both the opposing party and the court, justifying the exclusion of such testimony.

The SEC, on the other hand, compares this case to other instances where summary witnesses were admitted without the need for a formal expert disclosure. They stress that the procedural environment and the content of the testimony dictate the requirement for these disclosures.

The outcome of this motion could have significant implications for the ongoing litigation between Ripple and the SEC. If Ripple succeeds in getting the Fox Declaration removed from the record, it could potentially limit the SEC's ability to argue for specific penalties implied by the disputed calculations in Fox's testimony. Conversely, a successful declaration would reinforce the SEC's case by providing a foundation for its claims against Ripple.