A new twist has emerged in the ongoing legal battle between the Securities and Exchange Commission (SEC) and Ripple (XRP). John Deaton, the founder of CryptoLaw and attorney for XRP holders, has spotlighted a pivotal argument in Ripple’s recent filing. This argument, Deaton suggests, could significantly weaken the SEC’s stance.
Ripple and its top executives Brad Garlinghouse and Chris Larsen have opposed the SEC’s motion. They challenge the idea of certifying an interlocutory appeal. A specific footnote in Ripple’s argument caught Deaton’s attention.
It suggests that the SEC has consistently believed that the classification of a digital asset under the Howey test depends on the circumstances at the time of its sale. This revelation, Deaton argues, undermines the SEC’s rationale for an interlocutory appeal. Ripple’s stance is clear: such an appeal isn’t justified.
Fred Rispoli, another attorney involved in the Ripple case, shares Deaton’s sentiment. He finds it hard to believe that Judge Torres would side with the SEC, given that the legal analysis seems to favor Ripple.
Bill Morgan, a prominent attorney, and XRP community member expressed interest in Ripple’s perspective on ODL sales. This comes after Judge Torres’ recent decision. Ripple challenges the SEC’s decision to label ODL sales as institutional sales. Ripple’s defense is firm. Even if pre-complaint ODL sales were deemed institutional, they would contest any remedies based on post-complaint ODL sales.
Morgan emphasized another crucial point. If the SEC gets the green light to appeal, Ripple plans to cross-appeal on institutional sales. “This case is far from over,” Morgan commented. Ripple also hinted at a potential cross-appeal regarding the term “investment contract” and its interpretation. They argue that buyers should have rights and obligations should be placed on sellers.
Jeremy Hogan, another attorney, praised Ripple’s approach. He noted Ripple’s reference to the Youngers case, which states that appeal issues must be purely legal. For the SEC, this sets a high bar.
The legal tussle between Ripple and the SEC continues to evolve. The case promises more twists and turns, with seasoned attorneys like Deaton, Rispoli, Morgan, and Hogan weighing in. As Ripple mounts a robust defense, the crypto community watches closely, awaiting the subsequent development.
