The U.S. Securities and Exchange Commission (SEC) has officially filed a Civil Appeal Pre-argument statement (Form C) in its ongoing lawsuit against Ripple. This last-minute appeal seeks to overturn U.S. District Judge Analisa Torres’ 2023 ruling in favor of Ripple.
Fox Business journalist Eleanor Terrett flagged the appeal, noting that the SEC has outlined the key issues it plans to challenge. These include Ripple’s programmatic sales of XRP on digital asset trading platforms, as well as personal sales by Ripple executives Bradley Garlinghouse and Christian Larsen. Additionally, the SEC is appealing Ripple’s distribution of XRP to employees and others.
The original lawsuit filed by the SEC accused Ripple and its executives of violating the Securities Act of 1933 by selling XRP without proper registration. However, the SEC has chosen not to appeal the $125 million monetary penalty or Judge Torres’ refusal to grant disgorgement.
Missed Deadline Speculation
There was initial speculation that the SEC had missed its appeal deadline, which was set for October 16. Stuart Alderoty, Ripple’s Chief Legal Officer, confirmed in an interview with Fox Business that the SEC had until October 17 to file Form C, providing details of their planned appeal.
Prominent crypto lawyer James ‘MetaLawMan’ Murphy called the delay in the appeal “weird,” pointing out that the SEC’s Form C was dated October 16, but the court’s file stamp marked it as received on October 17. It remains to be seen if the 2nd Circuit will determine whether the SEC missed its deadline.
Despite the timing confusion, Ripple’s spokesperson clarified that the appeal process is proceeding as expected, and the related documents will soon be made public.
Ripple’s Partial Victory
Ripple secured a partial victory in July 2023 when the court ruled that XRP sales on digital platforms were not classified as securities. However, institutional sales of XRP were found to be unregistered securities. In August 2023, the court imposed a $125 million civil penalty on Ripple for these sales.
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