SEC Cannot Initiate Immediate Appeal Against Ripple, Says Ripple CTO

Ripple CTO David Schwartz stated that the US Securities and Exchange Commission (SEC) couldn't initiate an immediate appeal over Ripple's win in the partially concluded lawsuit. Schwart noted that both parties have pending issues that may hinder such a move.

The CTO aired his suggestion in response to the trending debate surrounding some potential options for the SEC in the lawsuit.

Four Options Available for the SEC

The prominent legal expert James Murphy known as MetalawMan, took to Twitter to analyze the regulator's next move. Murphy outlined four possible options the SEC could choose in its action following Ripple's win in the securities violation lawsuit.

Bottom line:

I expect the SEC to file a request for interlocutory appeal within the next 2 weeks.

I believe it would be in the best interests of Ripple & the #XRPCommunity for the appeals process to start now-rather than a year from now.

And I like Ripple's chances on appeal.

- MetaLawMan (@MetaLawMan) July 25, 2023

Murphy said the SEC could demand an interlocutory appeal in two weeks. The legal expert thinks making an immediate appeal bodes well for Ripple and the XRP community instead of delaying it for over a year.

Secondly, Murphy stated that the SEC may choose to pursue its aiding and abetting charges against Ripple executives Brad Garlinghouse and Chris Larsen.

Murphy mentioned that the third option for the SEC would be to drop its allegations against Garlinghouse and Larsen and immediately appeal the judgment without Judge Torres' permission.

He said the regulator doesn't need Judge Torres' permission after dropping the charges against the executives. Once it fulfills the third option, the Second Circuit can follow.

However, if the SEC remains hell-bent on pursuing the charges, it would have to wait ten days after Judge Torres approves the appeal request before asking for Second Circuit.

The last option listed by the legal expert is that SEC could initiate a settlement with Ripple but thinks it's unlikely to happen.

The SEC Can't Appeal Immediately Against Ripple

The analysis from the legal expert sparked several reactions in the crypto space, especially from the XRP community. According to a tweet from Ripple's CTO on July 26, the SEC can't just drop its case against Ripple executives to file an appeal immediately.

My understanding was that they don't have option 3 because the summary judgment ruling doesn't fully resolve the dispute between Ripple and the SEC. If nothing else, remedies haven't been argued. An I remembering wrong?

- David JoelKatz" Schwartz (@JoelKatz) July 26, 2023

Further, Schwartz mentioned that Judge Torres' ruling did not provide a complete resolution of the issues between the SEC and Ripple since the parties have yet to argue remedies after the summary judgment.

As Murphy highlighted, Schwartz's explanation cancels the option of filing an immediate appeal by the securities regulator, meaning the SEC has no option three.

The legal battle between the SEC and Ripple started in December 2020, with Judge Torres deciding on some key aspects of the case on July 13. However, the lawsuit remains unresolved in the Southern District Court of New York.

The judge's ruling mentioned that Ripple's sales of XRP to retail investors on exchanges worth more than $720 million are securities. But its sales to institutional customers, worth about $728.9 million, are classified as non-securities.

The post SEC Cannot Initiate Immediate Appeal Against Ripple, Says Ripple CTO appeared first on The Tech Report.