SEC Argues Ripple-XRP Case Requires Appeals Court Intervention
The U.S. Securities and Exchange Commission (SEC) has argued that the question of whether Ripple violated securities law by making XRP available to retail investors needs the intervention of an appeals court. This response was filed by the SEC after Ripple claimed that an appeal was unwarranted.
Last month, Judge Analisa Torres ruled in the U.S. District Court for the Southern District of New York that Ripple had violated federal securities law in selling XRP to institutional investors but not to retail investors. However, Judge Jed Rakoff, in a different case brought by the SEC, disagreed with this judgment. The SEC cited Judge Rakoff’s ruling in its argument for an interlocutory appeal, which would allow an appellate court to address certain legal questions during the ongoing case.
In its filing, the SEC stated, “The Defendants themselves say that the issues have industry-wide significance and are of special consequence.” This highlights the importance of the case and the need for clarification on whether Ripple’s actions violated securities law.
The SEC also signaled its intent to appeal Judge Torres’ ruling and has been given until September 1 to present its opposition. Ripple’s opposition memo, which prompted this response from the SEC, disputed the regulator’s argument for an appeal.
Granting the SEC’s motion for an appeal would require Judge Torres to allow the case to be presented before the Second Circuit Court of Appeals. The SEC argued that resolving the legal disputes through the appellate court at this stage would expedite the case’s resolution in the long term.
The ongoing legal battle between Ripple and the SEC has significant implications for the crypto industry, particularly regarding the classification of XRP as a security. Both parties await a decision from Judge Torres on whether the case will proceed to the appeals court.