Ripple SEC Case: After Judge Torres ordered Ripple to pay $125 million in fines in the damages phase, debate has raged over a possible appeal by the U.S. Securities and Exchange Commission (SEC). Some reports suggest the agency will not appeal the ruling, but legal experts say appeals of previous decisions are more likely, including summary judgment.
Judge Torres Ends Long-Running Ripple SEC Case
The Southern District of New York has ruled in a final judgment that defendant Ripple Labs must pay $125 million instead of the $2 billion sought by the US SEC. However, the regulator's injunction was upheld, and a federal judge permanently barred Ripple from selling XRP to institutional investors.
Ripple Labs CEO Brad Garlinghouse and CLO Stuart Alderothy said it was a major victory for the company, the crypto industry, and the rule of law. The executives expressed satisfaction with the verdict and indicated that they do not intend to appeal Judge Torres' decision.
"The SEC asked for $2 billion, and the court reduced their demand by about 94%, finding that they had overplayed their hand. We respect the court's decision and have clarity on the path forward for our company," Garlinghouse said.
Lawyers Say SEC, Ripple Appeals Are Near
While some reports have suggested that the SEC has decided not to appeal the remedy decision, lawyers confirmed that no such statements were made by Garlinghouse or Stuart Alderothy in recent interviews. XRP advocate Bill Morgan wrote, “Stuart has said nothing to indicate that he believes the SEC will or will not appeal.”
Former SEC lawyer Mark Fagel explained that the agency has 60 days to appeal the Ripple SEC case. This could also happen after Ripple pays civil fines to the regulator within 30 days. If the regulator appeals, “the money will likely be withheld until the appeal is resolved.”
Attorney Fred Rispoli mentioned that Ripple Labs would only cross-appeal if the SEC appealed first. Interestingly, the agency also did not use the “appeal” wording or react strongly against the ruling. Additionally, the company continues to believe that its current XRP sales no longer fall under the category of securities.
XRP ODL Sales to Continue Despite Ban
Attorney Jeremy Hogan said that XRP ODL sales will continue despite the injunction against the company. First, most of Ripple’s XRP and ODL sales are outside of U.S. jurisdiction and are not subject to the order. Second, XRP sales to institutions are permitted as long as they occur under one of five exemptions from registration.
Additionally, the crypto company has made significant changes to how it sells XRP to comply with the SEC's Ripple case ruling.
