Ripple case against SEC after judge rejects appeal

45
2
Ripple case against SEC after judge rejects appeal

A federal judge refused to let the U.S. Securities and Exchange Commission appeal a decision involving Ripple Labs, a decision that has seen as a major defeat for the regulator in its attempt to police cryptocurrency markets.

In her July 13 ruling, Judge Analisa Torres of Manhattan ruled that the sale of Ripple's digital token on public exchangescomplied with federal securities laws because purchasers had no reasonable expectation of profit based on Ripple's efforts.

The SEC had asked Torres to appeal Torres' findings about 'programmatic' sales of XRP and about 'other distributions' of XRP as a payment method for services, saying an appeal would be important to a 'large number' of lawsuits.

But the judge found no'substantial grounds for difference of opinion' about her findings, and did not agree that an appeal would materially advance the case toward a conclusion.

She also said she did not conflict with a U.S. District Court Judge Jed Rakoff in Manhattan, who said the SEC had had a 'plausible claim' that the TerraUSD token was a security when sold on public exchanges.

Torres said Rakoff had been considering Terraform's motion to dismiss the SEC case, and was required to accept all reasonable inferences in the regulator's favor.

A trial in the Ripple case is scheduled for April 23, 2024.

The SEC has not responded to calls for comment after market hours. The firm's lawyers for Ripple, Chief Executive Brad Garlinghouse and co-founder Chris Larsen did not immediately respond to similar requests.

The SEC has accused Ripple of illegally bringing in more than $1.3 billion in an unregistered securities offering by selling XRP.

The SEC has repeatedly asserted that many digital assets are securities, such as stocks and bonds, and has the authority to regulate them.

The lawsuits allege against Binance, the world's largest cryptocurrency platform, and Coinbase, the largest U.S. cryptocurrency platform.

Torres said in July that only some XRP sales violated federal securities laws.

The case is SEC v. Ripple Labs Inc., U.S. District Court, Southern District of New York, No.