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In an interesting development in the SEC lawsuit, Ripple announced yesterday it had filed a cross-appeal of Judge Torres’s final judgment, which was entered on Aug. 7, 2024.
Ripple CEO Brad Garlinghouse and Chairman Chris Larsen were named defendants in the cross-appeal notice to the United States Court of Appeals of the Second Circuit dated Oct. 10, 2024.
At the start of October, the SEC appealed the ruling, ordering Ripple to pay a $125 million civil penalty on its XRP sales, a fraction of the $2 billion sought by the regulator.
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The latest cross-appeal move by Ripple against the SEC has attracted attention from the crypto community. Ripple CEO Brad Garlinghouse, in a recent tweet, shared his expectations of the company’s cross-appeal move: “With our cross-appeal today, we’re looking forward to sealing the SEC’s fate and finally putting an end to the SEC’s regulation-by-enforcement agenda. Ripple was the industry leader in the first go-round in court and we look forward to leading the way in this round as well.”
SEC lost on all key points
Ripple Chief Legal Officer Stuart Alderoty took to X to highlight the SEC’s loss, hence, its move to appeal. “The SEC lost on all key points—that’s why they appealed,” Alderoty wrote.
Alderoty stated that Ripple filed a cross-appeal to ensure nothing is left on the table, including the argument that there cannot be an “investment contract” without there being essential rights and obligations found in a contract.
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The Ripple CLO highlighted that the SEC had previously stated that it would not appeal the ruling that XRP itself is not a security, and that they even apologized in another case for suggesting a token could itself be a security. “That’s the law, and an appeal on these other issues doesn’t change it,” Alderoty added.
Last year, the SEC unsuccessfully attempted to file an early appeal to the judgments that Ripple’s XRP sales on exchanges, and other XRP distributions – like to employees and developers – were not securities.
“They’ll likely go after these again – and they’ll lose both times,” Alderoty said, adding that the company is looking forward to the Federal Court of Appeals eventually putting a stake in the heart of SEC Chair Gary Gensler’s misguided attack on the cryptocurrency industry.
