April 19, 2024
Legal Debate Ignited by SEC's Rejected Appeal in Ripple Case
Latest Cryptocurrency News

Legal Debate Ignited by SEC’s Rejected Appeal in Ripple Case

Crypto lawyers are currently divided in their interpretation of a recent court decision by Judge Analisa Torres, where she denied the United States Securities and Exchange Commission’s (SEC) request to file an interlocutory appeal against Ripple.

Some legal experts see this as a substantial victory for Ripple in its ongoing legal battle against the SEC, while others urge caution in interpreting the decision.

Judge Torres denied the SEC’s interlocutory appeal on the basis that her previous ruling had only partially favored Ripple and did not involve a “controlling question of law,” a key requirement for approving such appeals. An interlocutory appeal is essentially an appeal made during an ongoing trial, in this case, the SEC’s case against Ripple, its CEO Brad Garlinghouse, and executive chairman Christian Larsen.

Bill Hughes, a lawyer at blockchain firm ConsenSys, expressed that he had expected the rejection of the SEC’s appeal, noting that it’s uncommon for such appeals to be granted at this stage of a trial.

On the other hand, crypto lawyer Jeremey Hogan was more confident in characterizing the decision as a “disaster” for the SEC. Hughes disagreed with this assessment, explaining, “The court says that [Torres’] ruling is limited to this case. Frankly, that’s fine for the SEC if they don’t mind one case not telling you very much about the next.”

Gabriel Shapiro, general counsel at Delphi Labs, also cautioned crypto enthusiasts not to overinterpret the ruling, emphasizing that it wasn’t a complete loss for the SEC.

Shapiro pointed out that while the SEC’s motion for an appeal was denied at this stage, the SEC could still pursue an appeal after the trial concludes. He clarified, “It doesn’t mean the SEC ‘lost its appeal’… it means that if the SEC wants to appeal, it has to appeal everything at once after the trial.”

Scott Chamberlain, an entrepreneurial fellow at the ANU College of Law, suggested that the decision might have more significant implications for Ripple than some acknowledge. He noted that while the SEC could potentially appeal later, they would be faced with a challenging factual record that could make a successful appeal more difficult. Chamberlain anticipated that any future appeal from the SEC would likely be heard in the Supreme Court, as there are no major legal questions remaining to be decided. The remaining task is applying existing law to a complex set of facts that do not support the SEC’s claims.

Ripple CEO Brad Garlinghouse also shared his perspective on social media, expressing his optimism. As per the latest court order, the trial is scheduled for April 23, 2024. If the SEC chooses to appeal, it must do so after the trial concludes.

Image by upklyak on Freepik

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