The SEC’s appeal largely centers on its dissatisfaction with a previous court decision. In July, a judge ruled that the XRP token did not qualify as a security for retail investors. The SEC has based its appeal on the contention that there are significant differences of opinion regarding the relevant laws.
Ripple’s legal team argues that the SEC has failed to meet the standard for a stay. They contend that exceptional circumstances required for an interlocutory appeal are absent in this case. The lawyers call on the judge to deny any request for an appeal or stay.
Background of the Lawsuit
The SEC initiated a lawsuit against Ripple, its CEO Brad Garlinghouse, and co-founder Chris Larsen in December 2020. This legal action led to many exchanges delisting the XRP token to avoid potential legal complications. However, following the July ruling that XRP largely did not qualify as a security, several exchanges announced plans to relist the token.
Memo filed Sept. 1 in U.S. District Court for the Southern District of New York. Source: CourtListener
The civil lawsuit between the SEC and Ripple remains ongoing. The judge has proposed a jury trial for the case, set to commence in the second quarter of 2024. Ripple continues to challenge the SEC’s actions, asserting that the regulatory body has been consistently wrong on both legal and factual matters.
SEC’s Broader Crypto Actions
In 2023, the SEC has taken legal action against multiple crypto firms, including Binance and Coinbase, alleging securities violations. Notably, asset manager Grayscale recently achieved a legal victory against the SEC, leading to a review of its application for a spot Bitcoin exchange-traded fund.