In a Twitter thread, Ripple’s Chief Legal Officer Stuart Alderoty added that the SEC’s latest appeal did not challenge the court’s non-security classification of XRP. The latest filing of the SEC on form c, which was on 16 October, tries to appeal some aspects of the case but does not disturb the non-security status of XRP.
Thus, the civil appeal of the SEC doesn’t raise an argument against the decision stating that XRP is not a security if it is sold on exchanges, which was filed with a pre-argument statement. Rather, it quantifies information from the summary judgment in the court regarding Ripple’s XRP sales on exchanges and direct sales by Garlinghouse and Larsen.
Ripple’s legal team reacted quickly to the measures taken by the SEC. On October 17, Filan described the defense’s position, noting that Ripple has filed an appeal on the decisions regarding the sales of XRP by the company’s executives and the distribution of XRP for non-saddle cash consideration.
SEC Appeal Leaves XRP’s Non-Security Status Intact, Ripple Prepares Form C Response
Stuart Alderoty weighed in on this on X (formerly Twitter) and confirmed that the position on XRP as the non-security asset remains affirmed. “That decision stands as the law of the land,” Alderoty said. He also pointed out that Ripple had already planned to counter-suing the SEC by filing Form C.
No surprises here — once again it’s been made clear. The Court’s ruling that “XRP is not a security” is NOT being appealed. That decision stands as the law of the land.
Stay tuned for Ripple’s Form C to be filed next week. https://t.co/m9molUGSBv
— Stuart Alderoty (@s_alderoty) October 18, 2024
Based on these allegations against Garlinghouse and Larsen, the SEC, in its appeal, alleged that executives engaged in selling and offering XRP and “assisted Ripple in violating the law” of securities. The appeal asks for a ‘de novo’ trial, in other words, the trial court will base its decision on the appellants and respondents’ new evidence for the matter.
Ripple’s legal fight with the SEC will likely extend into 2023 or even 2025. Appeal process Shortly after expressing disappointment, Fox Business producer Eleanor Terrett outlined the appeals process. The process requires that Ripple file what is known as Form C in response seven days after the SEC files its Form C. The parties will have a briefing schedule that both have agreed to.
🚨NEW: Just had a great chat with @s_alderoty of @Ripple who gave me a rundown of the appeals timeline.
📌The @SECGov’s last day to file Form C (which will give some level of detail about what it plans to appeal) is tomorrow.
📌Seven days later, Ripple will file its own Form…
— Eleanor Terrett (@EleanorTerrett) October 15, 2024
After that, the SEC will have up to 90 days to file its first brief, followed by more legal steps, which should extend to at least July 2025, according to Alderoty. This extension also extends the already rather lengthy conflict between the regulator and Ripple, which has implications for the rest of the Officina crypto industry.
The SEC’s most recent appeal came after Ripple was granted partial triumph in August 2020. New York Southern District Court Judge Analisa Torres sided with Ripple, ending the case in which the regulator asserted that XRP was a security when sold on digital asset exchanges on a program basis. The ruling was historical for Ripple and the market as it brought some clarity regarding the status of XRP as a security.
Ripple was not without its problems. It was still dependent on a relatively young technology network called XRP Ledger. In August, the judge ordered the defendant firm and its director to pay a $125 million civil penalty not to violate the 1933 Securities Act Section 5 again and issued an injunction statement against Ripple. Although Ripple’s legal representatives were able to rejoice about the partial legal victory, the SEC still went on with its appeal, specializing in specific aspects connected to sales of XRP and the actions of Ripple executives.
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