Coinspeaker
SEC and Ripple Mighty Pursue Appeal after Landmark Ruling
Barely 24 hours after Judge Analisa Torres imposed a $125 million penalty fee on blockchain payment company Ripple Labs Inc in its case with the United States Securities and Exchange Commission (SEC), legal experts are already talking about a possible appeal. However, it is strongly believed that the appeal could come from both the blockchain company and the regulator.
Ripple Fined $125M in SEC Lawsuit, Next Steps?
On Wednesday, District Judge Analisa Torres, of the Southern District of New York, imposed $125 million in civil penalties on Ripple after discovering that 1,278 institutional sale transactions by the payments firm violated securities law. Additionally, the federal judge imposed an injunction against future securities law violations on Ripple.
The penalty is significantly lower than the $2 billion that the SEC initially requested but way higher than the $10 million that Ripple offered to pay. Noteworthy, Ripple cited SEC’s $4.5 billion settlement with Terraform Labs when it requested that Judge Torres should revise the penalty of no more than $10 million. Precisely, Ripple said that Terraform Labs’ $420 million civil penalty was just around 1.27% of its “$33 billion gross sales”.
With the $125 million penalty, legal experts Attorney Bill Morgan and James Murphy also known as MetaLawMan, speculate that both sides will appeal. They based their prediction on the fact that the court’s final judgment ended in a partial victory for both the SEC and Ripple. On the other hand, the permanent injunction is a win for the regulator.
Till now, the SEC is yet to issue any official statement regarding the final judgment. A comment from the SEC would help the public understand whether or not it plans to appeal the decision. For now, a 60-day countdown for the SEC and Ripple to appeal has commenced. It started right after Judge Analisa Torres gave her ruling on Wednesday.
Noteworthy, the Commission could seize this opportunity to revisit an initial appeal that the same federal judge denied in 2023. Shortly after Judge Torres ruled in July that XRP offered for programmatic sales to retail clients are not security, SEC tried to file an interlocutory appeal. Unfortunately, the judge denied its request.
SEC May Overlook an Appeal Due to US Election
On the other hand, the entire lawsuit may eventually fall in favor of Ripple. The timing coincides with the United States presidential election cycle. Most of the aspirants and their parties are intensely pursuing alliances with the crypto sector. Republican presidential candidate Donald Trump plans to oust SEC Chair Gary Gensler once he gets into office.
Not appealing the judge’s verdict could serve as the SEC’s strategy to win the favor of the public, particularly, the crypto community. As part of this strategy, the regulator already dropped an argument in a case with Binance.US. The SEC suddenly decided to not give the securities tag to third-party tokens, like Solana, Polygon, and Cardano.
