Ripple's Notice of Cross-Appeal Follows SEC's Notice of Appeal
Ripple Labs has escalated its legal battle with the US Securities and Exchange Commission (SEC) by filing a cross-appeal with the US Court of Appeals for the Second Circuit on 10 October.
BREAKING🚨🚨 #Ripple Has Filed Cross Appeal. Let's Go #XRP 💥💥🚀🚀🚀 pic.twitter.com/xlhcjOzPCJ
— XRP CAPTAIN (@UniverseTwenty) October 10, 2024
This move follows the SEC's appeal on 2 October, aimed at overturning a ruling that found Ripple's programmatic sales of XRP to retail investors did not violate securities laws.
The Court of Appeals will now review both appeals — the SEC's and Ripple's — to assess potential legal or procedural errors in the 7 August decision.
In that ruling, a federal judge imposed a $125 million civil penalty on Ripple for securities law violations.
These merged appeals extend a legal dispute that has gripped the crypto industry since the SEC's initial complaint in 2020.
Ripple Plans to Fight All the Way
Ripple has officially filed a cross-appeal with the US Court of Appeals for the Second Circuit, contesting the final judgment that required the company to pay $125 million in civil penalties for institutional XRP sales.
BREAKING: the final ruling in the SEC vs Ripple lawsuit has been issued by Judge Torres: Ripple must pay $125 million to the SEC. #XRP NOT A SECURITY. It’s over! pic.twitter.com/ZmQDFQVjVe
— CryptoBull (@CryptoBull2020) August 7, 2024
While this amount is considerably lower than the nearly $2 billion originally sought by the SEC, it remains far above Ripple's proposed $10 million settlement.
According to Ripple's Chief Legal Officer, Stuart Alderoty's post on X (formerly known as Twitter), the cross-appeal ensures that "nothing is left on the table," preserving all legal arguments in the case.
Although Alderoty did not specify the exact points Ripple will argue, he suggested the SEC may continue to assert that XRP sales on exchanges and distributions to employees are securities.
Importantly, the SEC has already said they aren’t appealing the ruling that XRP itself isn’t a security. (They even apologized in another case for suggesting a token itself could be a security!) That’s the law, and an appeal on these other issues doesn’t change it.
— Stuart Alderoty (@s_alderoty) October 10, 2024
Ripple CEO Brad Garlinghouse echoed the sentiment, accusing the SEC of creating disruption without offering regulatory clarity for the US crypto industry.
As I said earlier this month, if Gensler and the SEC cared about the rule of law, they would accept their loss and move on. But they are not interested in faithfully applying the law or in providing clarity to industry players in the US. Under Chair Gensler, the agency is only… https://t.co/hFlkXw83s8
— Brad Garlinghouse (@bgarlinghouse) October 10, 2024
Both parties are expected to file additional briefs in the coming months, with the SEC's submission likely due by late January, followed by Ripple's response.
Alderoty said about the appeals court taking up the case:
"I don't think that folks who are paying attention should be much distracted by these efforts to create confusion, because I think the judge got it right, and I think they should welcome the opportunity for the court of appeals to roll on this issue and finally, bring the clarity that we need."
He added:
"Short of that, and while we don't have one, it's going to be up to the courts, and we're willing to continue to fight that fight and collect victories and bring clarity to the industry through the litigation process."
He expressed optimism that the federal court of appeals will finally bring an end to what he views as SEC Chair Gary Gensler's misguided campaign against the crypto industry.
We look forward to the federal court of appeals finally putting a stake in the heart of Gensler’s misguided attack on our industry.
— Stuart Alderoty (@s_alderoty) October 10, 2024
However, the timeline remains uncertain, and it is unclear whether the SEC will focus solely on contesting the penalties or challenge broader aspects of the ruling.
As the legal battle continues with no resolution in sight, it raises the question of how long this drawn-out conflict will persist.
