SEC Appeals Court Ruling in Ripple Case

The United States Securities and Exchange Commission (SEC) has challenged the August court ruling in its lawsuit against Ripple in the Second Circuit Court of Appeals.

#XRPCommunity #SECGov v. #Ripple #XRP BREAKING: The @SECGov has filed a Notice of Appeal of Judge Torres’s Ruling. pic.twitter.com/j8bLIZQ5LT

— James K. Filan ???? (@FilanLaw) October 2, 2024

According to a comment from an SEC representative to The Block, the verdict “contradicts decades of Supreme Court precedents and legislation.”

Judge Analisa Torres fined Ripple $125 million — the SEC had sought a $2 billion penalty. The decision also upheld parts of the agency’s motions, including a ban on the company violating securities laws.

The parties have been in litigation since 2020, when the Commission accused Ripple of raising $1.3 billion through the sale of XRP as unregistered investment contracts.

In July 2023, the company achieved a partial victory. Judge Torres ruled that secondary sales and other distributions of tokens did not violate existing regulations. However, this did not apply to institutional purchases of XRP exceeding $700 million.

Following the court’s August decision, Ripple anticipated an SEC appeal. Nevertheless, the firm’s chief legal officer, Stuart Alderoty, expressed confidence that this would not affect XRP’s status as a non-security.

He described the Commission’s attempt to challenge Torres’s ruling as “disappointing but not surprising.”

“It merely prolongs what is already a complete embarrassment for the agency. The court has already dismissed the SEC’s suggestion that Ripple acted recklessly. There were no allegations of fraud and certainly no victims or harm,” wrote Alderoty.

The lawyer characterized the regulator’s actions as a continuation of its “war against the industry.” He also questioned whether it was a coincidence that SEC’s Director of Enforcement, Gurbir Grewal, announced his resignation about an hour before the appeal was filed.

If Gensler and the SEC were rational, they would have moved on from this case long ago. It certainly hasn’t protected investors and instead has damaged the credibility and reputation of the SEC.

Somehow, they still haven’t gotten the message: they lost on everything that… https://t.co/1hW7xVSL9b

— Brad Garlinghouse (@bgarlinghouse) October 2, 2024

“If Gensler and the SEC were rational, they would have moved on from this case long ago. It certainly hasn’t protected investors and instead has damaged the credibility and reputation of the Commission. Somehow, they still haven’t gotten the message: you lost on everything that mattered. Ripple, the crypto industry, and the rule of law have already won,” stated the company’s CEO, Brad Garlinghouse.

The entrepreneur confirmed that Ripple is not concerned about XRP’s status and is prepared to continue the legal battle with the regulator “for as long as it takes.”

In the 2024 fiscal year, the SEC’s enforcement actions against the crypto industry reached a record $4.7 billion. A significant portion of this amount came from the settlement with Terraform Labs and its former CEO Do Kwon for $4.47 billion.