- Ripple calls for court to reject the SEC’s request for appeal regarding the XRP sales case.
- A landmark decision in July had deemed some XRP sales non-violative of securities laws.
- Ripple’s lawyers argue that conditions for interlocutory appeal aren’t met.
Ripple Labs robustly opposes the Securities and Exchange Commission’s push for appeal on a significant decision regarding XRP’s sales. This development signals the evolving complexity of defining crypto transactions within the framework of securities laws.
Ripple’s Defensive Stance
In response to the SEC’s move for appeal, Ripple Labs submitted a fresh filing on Friday. The core argument posited by Ripple’s lawyers is that “exceptional circumstances required for interlocutory appeal are absent.” They further elaborate that the court’s summary judgment does not raise a controlling question of law apt for such an appeal. According to them, the SEC’s disagreement stems from their discontent with the court’s interpretation of the Howey Test to most of Ripple’s XRP transactions.
SEC’s Grounds for Appeal
Last month, the SEC formally approached the U.S. District Court in the Southern District of New York, urging certification for interlocutory appeal. Their standpoint is that the Ripple case’s handling could significantly influence other concurrent lawsuits, such as those involving prominent crypto exchanges like Binance and Coinbase. The agency’s contention is that an immediate appellate ruling on these subjects could expedite the litigation’s final resolution.
The Historical Context: July’s Landmark Decision
In a pivotal ruling in July, Judge Analisa Torres asserted that some of Ripple’s XRP sales, termed ‘programmatic’, did not breach securities regulations due to the existing blind bid procedure. Conversely, she also identified other direct XRP sales to institutional stakeholders as securities, registering a partial victory for the SEC. Now, the SEC aims to challenge the verdict concerning programmatic sales and other XRP distributions that encompassed token exchanges for goods and services.
Ripple’s Potential Countermove
Ripple has not merely been on the defensive. They’ve indicated that if the SEC’s appeal progresses, they would initiate a “cross-appeal” targeting the court’s directive on XRP’s institutional sales. This counter-appeal would necessitate a thorough examination of the complete case record, as opposed to the selective highlights the SEC might prefer to spotlight.
Conclusion
This ongoing legal tussle between Ripple and the SEC underscores the broader challenges of classifying and regulating cryptocurrencies in the rapidly evolving digital finance landscape. As the two entities continue their legal skirmishes, the eventual outcomes will undoubtedly have lasting ramifications for the crypto sector at large.
