- Legal experts have dissected Ripple’s potential strategies amidst the SEC’s lawsuit appeal.
- Ripple’s decisions currently hold the power to reshape the trajectory of this ongoing battle.
- A new layer of complexity unfurls as Ripple could potentially cross-appeal.
The SEC vs. Ripple legal showdown has captivated the crypto community, now intensified by recent developments. The SEC’s bid for an interlocutory appeal has ignited fervent analysis, with legal experts chiming in on potential outcomes. Insights from James “MetaLawMan” Murphy, Bryan Jacoutot, and Bill Morgan offer a glimpse into unfolding scenarios.
Scenario 1: Ripple Challenges the Appeal
Ripple’s initial move could be contesting the appeal certification. Their stance rests firmly in Judge Torres’ decision, notably on secondary market XRP sales. Ripple aims to demonstrate that the decision aligns seamlessly with its legal position.
MetaLawMan outlines three reasons for this choice. First, Ripple resists the idea of a “substantial difference of opinion,” a requisite for an interlocutory appeal. Second, a future crypto law might redefine institutional XRP sales, erasing their security classification due to a lack of equity association. Third, a new administration could shift the SEC’s crypto enforcement strategy by 2025.
Scenario 2: Ripple Accepts the Appeal
Alternatively, Ripple might concur with the SEC on an interlocutory appeal, acknowledging the inevitability of appeals. Timing remains pivotal. Will the appellate process commence immediately, or will it be deferred until the culmination of the trial involving Brad Garlinghouse and Chris Larsen?
Ripple Seeks Cross-Appeal
As elucidated by MetaLawMan, the strategic rationale revolves around the potential for the 2nd Circuit to overturn the SEC’s triumph on this front, thus obviating the necessity for a trial on aiding and abetting institutional sales.
Attorney Bill Morgan zeroes in on a pivotal facet of Judge Torres’ pronouncement regarding sales to On-Demand Liquidity (ODL) customers. He underscores the magnitude of this edict, underscoring that all Ripple transactions after June 2020 were channeled toward ODL customers.
Scenario 3: A Deeper Dive
Bryan Jacoutot, a distinguished partner at the Election Law Group, directs attention toward the Terraform Labs case. A precedent capable of exerting significant influence on Judge Torres’ deliberation. Jacoutot underscores the salience of the SEC’s invocation of the Terraform case.
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In this instance, the judge “repudiated” a portion of Judge Torres’ analysis, notably her demarcation between institutional and “programmatic” sales. This repudiation isn’t a mere quibble; it constitutes a direct challenge to the bedrock underpinning Judge Torres’ ruling in the Ripple litigation.
Given this intra-district divergence between the XRP case and the Terraform precedent, Jacoutot posits that the present case is a prime contender for an interlocutory appeal. Should Judge Torres acquiesce to the SEC’s entreaty, the 2nd Circuit Court of Appeals could proffer its insights on this momentous matter.
On the Flipside
- A new administration in 2025 might not necessarily translate to an immediate change in the SEC’s stance on crypto enforcement, challenging the notion of swift resolution based on political transitions.
- While an interlocutory appeal could streamline the process, there’s no guarantee that it will lead to a more definitive outcome, as appellate courts might still defy the trial court’s judgment in complex cases.
Why This Matters
The eventual outcome of this lawsuit has the potential to set a precedent that resonates far beyond the courtroom, sculpting the contours of future crypto endeavors and fostering a climate of clarity and innovation.
To learn more about Ripple’s preparation in response to the SEC’s appeal request, delve into the details here:
Ripple Prepares Response as SEC Asks for Appeal Permission
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