Ripple and SEC Seek Resolution in Ongoing XRP Legal Battle
The ongoing legal battle between Ripple Labs Inc. and the U.S. Securities and Exchange Commission (SEC) may finally reach a pivotal resolution. On June 12, 2025, both parties submitted a joint letter to Judge Analisa Torres, requesting an “indicative ruling” that could potentially dissolve the injunction imposed on Ripple the previous August. This act aims to release a large portion of the $125 million civil penalty kept in escrow.
Potential Conclusion to the XRP Dispute?
The motion, filed under Federal Rules of Civil Procedure 62.1 and 60(b)(6), follows a previous similar request rejected by Judge Torres in May due to insufficient demonstration of “exceptional circumstances.” This renewed filing seeks to address those gaps by highlighting settlement efficiency, judicial resource conservation, and the SEC’s evolving enforcement priorities regarding cryptocurrencies.
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In the proposed settlement, Ripple would pay $50 million to the SEC, effectively satisfying the penalty. Meanwhile, approximately $75 million, along with accrued interest, would revert to Ripple. Moreover, the permanent injunction, which was enforced due to violations of Section 5 of the Securities Act on August 7, 2024, would be lifted. The parties stress that this compromise is vital for settlement and, upon an indicative ruling, they intend to request a limited remand from the Court of Appeals to enact this relief and dismiss the appeals.
The procedural history of this case includes a significant ruling on July 13, 2023, where Judge Torres identified that Ripple’s institutional XRP sales violated federal securities laws. However, she ruled that programmatic sales on crypto exchanges did not constitute investment contracts. Following the voluntary dismissal of the SEC’s remaining claims against Ripple executives Brad Garlinghouse and Chris Larsen, the court imposed the $125 million civil penalty on August 7, 2024, prohibiting further unregistered XRP institutional sales.
The appeals process initiated in October 2024 was paused on April 16, 2025, to allow time for settlement discussions. The joint indicative ruling request made on May 8, 2025, was initially denied due to the lack of a thorough explanation for meeting the Rule 60(b)(6) “exceptional circumstances” requirement.
The updated submission relies on authoritative cases, such as Microsoft Corp. v. Bristol Tech. and Major League Baseball Props. v. Pacific Trading Cards, which allow for judgment modification when it is essential for settlement and enhances judicial efficiency. The SEC’s recent policy shift under Acting Chair Mark Uyeda and the establishment of a new Crypto Task Force are also highlighted as supportive of the requested relief.
The parties clarify that public interests remain intact, as Judge Torres’s substantive summary judgment ruling will remain binding. The requested modifications pertain only to penalty size and injunctive scope, reflecting the unique aspects of this case and carrying minimal precedential impact.
Future Proceedings
Judge Torres must now determine if the outlined factors satisfy the stringent Rule 60(b)(6) criteria. If she indicates a willingness to grant relief, Ripple and the SEC will petition the Second Circuit to remand the case for an amended judgment. This would lead to the voluntary dismissal of both the SEC’s appeal (No. 24-2648) and Ripple’s cross-appeal (No. 24-2705).
Should the court decline, the legal proceedings will continue on the appellate track, prolonging a saga that started with the SEC’s lawsuit against Ripple on December 22, 2020. Currently, the outcome of the injunction and $75 million in escrowed funds—and by extension, Ripple’s immediate regulatory status—hinges on whether Judge Torres deems the “exceptional circumstances” criterion satisfied after nearly five years.
As of the latest update, XRP is trading at $2.11.
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