Ripple’s Legal Battle with the SEC: A Turning Point
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Ripple Reassesses Strategy After Legal Ruling
Ripple Labs finds itself at a pivotal moment after the recent judgment by Judge Analisa Torres in its protracted legal case against the U.S. Securities and Exchange Commission (SEC). The company is now faced with a critical decision: to continue with an appeal or to accept the judgment in hopes of obtaining relief.
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Challenges in Ripple’s Legal Confrontation with the SEC
According to a recently released court document, Judge Torres has rejected the joint motion from Ripple and the SEC for an indicative ruling. This motion aimed to relieve Ripple by dissolving the injunction and reducing the penalty from $125 million to $50 million. However, Judge Torres found that both Ripple and the SEC did not present any exceptional circumstances that would justify altering her judgment, as it would not serve the public interest or the administration of justice.
The judge emphasized that even if jurisdiction were reinstated to her court, she would still refuse to vacate the injunction or lessen the civil penalty. She pointed out that Ripple’s violations remain unchanged since the adverse ruling, despite any claims otherwise. The SEC had previously argued that an injunction was necessary to prevent Ripple from continuing to breach securities laws, and Judge Torres was not persuaded by Ripple’s contention that the injunction and penalty were specific to this case and not aligned with public interest.
Further, the judge noted that the SEC sought a civil penalty to serve as a deterrent to Ripple and similar entities. Although Ripple argued that the SEC had dropped other enforcement actions, Judge Torres observed that those cases were not comparable to Ripple’s situation.
Future Trajectories in the Ripple Case
In her remarks, Judge Torres suggested that Ripple and the SEC could abandon their appeals if they sincerely wish to conclude the litigation. Conversely, Ripple may choose to continue its appeal if it seeks relief from the final judgment. Judge Torres clarified that neither party possesses the authority to disregard a final judgment based on a settlement agreement alone; only an appellate court holds the power to overturn her ruling.
Legal experts, such as Fred Rispoli, anticipate that Ripple and the SEC might eventually retract their appeals and settle on a $50 million agreement, with the injunction remaining intact. Ripple’s Chief Legal Officer, Stuart Alderoty, acknowledged that the next steps lie with Ripple, emphasizing the possibilities of dropping the appeal or contesting the judgment concerning historical institutional sales. Nevertheless, Alderoty affirmed that XRP’s legal status as a non-security remains unchanged.
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