Ripple vs. SEC Lawsuit Latest Update: “Waiting for the Judge”

Recently, a well-known lawyer, James K. Filan, shared some news about the ongoing legal fight between Ripple and the SEC. He mentioned that all the legal documents, including the SEC’s final reply brief, are now public.

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Another famous lawyer, Jeremy Hogan, checked out the SEC’s filing and wasn’t too impressed. Hogan thinks the SEC’s final brief might not be as powerful as people thought. Instead of directly challenging Ripple’s XRP sales through its ODL service, the SEC focused on arguing that Ripple is just repeating old arguments. Hogan also noticed that the SEC didn’t bring up any new evidence about potential damages.

Jeremy Hogan’s Perspective on the Ripple-SEC Case

Jeremy Hogan, a prominent legal commentator, has been vocal about his views on the ongoing legal battle between Ripple and the SEC. He previously speculated that Ripple might face a court-ordered penalty of $100 million, significantly lower than the SEC’s initial request of $2 billion. Now that the briefing phase of the case has concluded, attention shifts to the presiding judge. Hogan, along with other observers, anticipates that regardless of the judge’s ruling, both Ripple and the SEC are likely to file appeals.

The Ripple v. SEC briefs are FINISHED!

And I think the SEC went out with a whimper here.

It didn't even try to attack ODL sales, just noting that Ripple was trying to re-litigate the issue (which it is).

And it brought nothing new on damages.

Just waiting for The Judge now! https://t.co/r8nxNMTzqj pic.twitter.com/Futa93lXUb

— Jeremy Hogan (@attorneyjeremy1) May 8, 2024

Background of the Ripple-SEC Lawsuit

The SEC initiated legal action against Ripple in December 2020, alleging that Ripple’s sale of XRP violated securities laws. According to the SEC, the sale of XRP constitutes an investment contract, and Ripple failed to register these transactions. In contrast, Ripple contends that XRP is not a security and therefore exempt from registration requirements. In a significant development in July 2023, the court ruled in favor of Ripple, determining that non-institutional sales of XRP did not qualify as securities offerings.

Assessment of SEC’s ODL Avoidance and Ripple’s Response

Jeremy Hogan’s observation regarding the SEC’s apparent avoidance of addressing the issue of Ripple’s On-Demand Liquidity (ODL) service is noteworthy. ODL is a service provided by Ripple that facilitates cross-border payments using XRP. If the SEC were to successfully argue that XRP sales through ODL constitute unregistered securities offerings, it would significantly bolster their overall case.

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However, Ripple has taken steps to mitigate potential legal risks by transitioning away from XRP and using USDT to settle ODL transactions for U.S. customers. This move demonstrates Ripple’s willingness to comply with the legal framework in the U.S. and weakens the SEC’s claim to a substantial penalty.

Awaiting Judge’s Decision and Potential Appeals

With the conclusion of the briefing phase, all parties involved await the decision of the presiding judge. Following the verdict, the likelihood of appeals from both Ripple and the SEC remains high, potentially leading to a prolonged legal battle.

Recently, a significant class action lawsuit was filed against Coinbase, alleging that eight cryptocurrencies, including XRP, are securities. If the court rules against Coinbase in this lawsuit, it could bolster the SEC’s case if it chooses to appeal the July ruling, further complicating the legal landscape surrounding cryptocurrency regulation.

Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.

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