Key points

  • Ripple vs. SEC case has been going on for years but has taken a dramatic turn as the US SEC recently lost partially. 
  • The Presiding Judge ruled that the sale of XRP in primary and programmatic markets does not constitute the factors that could deem it a security.
  • Now, Ripple Labs Chief Legal Officer has hit back at the US SEC for filing a request for an appeal against the US SEC, saying there currently are no “extraordinary circumstances” in the case that warrants an interlocutory appeal at this stage.

Ripple Labs’ chief legal officer has hit back at the US SEC, expressing that no “extraordinary circumstance” warrants the US SEC’s ability to appeal the partial loss while the case is still pending.

Ripple Labs legal counsel not convinced by US SEC appeal.

Ripple Labs Chief Legal Officer Stuart Alderoty has hit back at the US SEC move towards filing for an interlocutory appeal relating to their July 13 XRP case partial loss laid down by U.S. District Court Judge Analisa Torres. 

In an August 16 letter, Judge Torres explained that XRP failed to pass Howey’s tests in primary or programmatic markets, which makes it not a security. She explained that the court should reject the SEC’s motion for leave to file an interlocutory appeal. An interlocutory appeal occurs when a ruling by a court gets appealed as other aspects of the case are still underway.

Now, Ripple Labs’ legal system believes it is more appropriate for the US SEC to wait until the final ruling before filing for an appeal. The lawyers explained three main arguments starting with that the appeal needs the US SEC to raise new legal issues, which has yet to be the case.

Secondly, they claim that the US SEC that the court ruled incorrectly on the matter could be more efficient since it has to show that at least two courts are in apparent conflict with each other, which is not the case here. Thirdly, they explained that an immediate appeal would not advance the termination litigation proceedings. 

Ripple Labs Chief Legal Officer Stuart Alderoty explained that the US SEC doe not have any extraordinary circumstance that would justify departing from the normal legal procedure.

“No extraordinary circumstance here would justify departing from the rule requiring all issues as to all parties to be resolved before an appeal.”

This case is expected to continue with the US SEC not giving up quickly, as it sets a significant precedent for all other cases connected to certain crypto assets being securities. By now, the US SEC has branded over 62 crypto assets as securities and charged multiple exchanges for trading them in the US.

As such, the case will be a landmarking event in the crypto industry as it will change the regulatory approach of the industry in the US forever. Keep watching Fintech Express for more updates on crypto regulation and other fintech-related developments.