Ripple may file a cross-appeal to challenge the SEC’s legal ruling

Share this article

Ripple plans to file a cross-appeal in response to the SEC’s appeal of the August 7 court ruling that ordered Ripple to pay $125 million to settle charges related to institutional sales of XRP tokens. said Ripple’s Chief Legal Officer, Stuart Alderoty.

The penalty, while higher than Ripple’s suggested $10 million, is significantly less than the nearly $2 billion originally sought by the SEC, which included extensive prejudgment and prejudgment interest.

The court also ruled that XRP tokens sold on secondary markets do not qualify as securities.

It is not yet clear whether the SEC will challenge Ripple’s imposition of the fine or the court’s ruling that secondary market sales of XRP tokens are not securities.

With the SEC’s decision to proceed with the appeal, Ripple is evaluating a counter move in the ongoing SEC litigation regarding XRP. This could involve Ripple appealing Judge Torres’ ruling on selling XRP to institutions as investment contracts or challenging the $125 million fine.

Both appeals would be consolidated into a single case before the Court of Appeal. Ripple has 14 days from tomorrow to file the cross appeal.

Alderoty said he was disappointed by the SEC’s decision, but not surprised. He criticized the SEC’s litigation strategy as prolonging “embarrassment.”

“The court has already rejected the SEC’s suggestion that Ripple acted recklessly and there were no allegations of fraud, and certainly no casualties or losses,” Alderoty said.

“Instead of faithfully enforcing the law, this agency, under this president, continues to engage in a litigation war against the industry. We are evaluating whether to file a cross-appeal. In any case, the SEC process was irrational and flawed from the start, and we are ready to prove that once again in the appellate court,” he added.

The appeal was filed just an hour after Gurbir Grewal, who heads the SEC’s enforcement actions, announced his resignation. It is unclear whether Grewal’s departure was related to the handling of the case.

According to attorney Fred Rispoli, the Second Circuit won’t rule until January 2026, probably no sooner than March or April.

For #XRPHoldershere is the timeline of the SEC v. Ripple appeal:

1. The SEC filing will likely take place on 12/2/24. The SEC is likely to seek the 30 day extension allowed, so it will be due shortly after 1/1/25.

2. Ripple will appeal incidentally. The opening brief will take place around the same time.

3. The…

— Fred Rispoli (@freddyriz) October 2, 2024

Share this article