The Securities and Exchange Commission (SEC) asked for more time to submit documents related to remedies in the Ripple case. Judge Analisa Torres agreed to extend the deadline, potentially affecting the outcome of Ripple Labs’ legal battle.
Court documents filed on March 1 granted the SEC more time to submit its discovery materials in Ripple’s case. The extension pushes the regulator’s opening brief deadline to March 22. Ripple’s deadline for their opposition brief is now April 22, and the SEC’s reply deadline is set for May 6, 2024.
SEC vs. Ripple Labs: Allegations and Disputes
In December 2020, the Securities and Exchange Commission (SEC) launched a case against Ripple Labs, accusing the company, along with CEO Brad Garlinghouse and co-founder Chris Larsen, of conducting an unregistered securities offering totaling $1.3 billion through the sale of the XRP token.
The heart of the conflict revolves around the classification of the XRP token. The SEC argues that XRP should be classified as a security, subjecting it to rigorous regulatory standards. Ripple, on the other hand, contends that XRP does not meet the criteria for a security and asserts that the SEC failed to provide adequate notice regarding its classification.
Ripple Lawsuit: Howey Test Debate & Torres Ruling
The lawsuit involving Ripple has undergone numerous developments and legal skirmishes over the years.
A significant aspect of the case revolves around the “Howey test,” a legal framework used to assess whether a transaction qualifies as an “investment contract” under U.S. law. The SEC contends that XRP satisfies the conditions of the Howey test, whereas Ripple disputes this assertion.
In a significant development in July 2023, Judge Analisa Torres delivered a partial ruling favoring Ripple Labs. She determined that XRP did not qualify as a security concerning its sales on digital asset exchanges. However, the judge also concluded that XRP should be classified as a security when sold to institutional investors.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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