SEC hints at potential appeal of Ripple Labs lawsuit's XRP ruling
According to court documents, the SEC said it was "now considering the various avenues available for further review" of the decision that found XRP not a security.
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The U.S. Securities and Exchange Commission has suggested it may appeal a recent ruling in the lawsuit by Ripple Labs, which found XRP not to be a security when sold to retail investors.
The SEC argues that the ruling violates "fundamental principles of securities law" such as the Howey test, which determines what does and does not fall within the category of an investment contract.
Do we really want a judge to ask: Does my strict application of the Howey test in this case lead to an outcome in 2023 that matches the policy implications of a 1934 law? https://t.co/acMNRc00B6
— John E Deaton (@JohnEDeaton1) July 22, 2023The SEC's latest comments on Ripple Labs' lawsuit come as part of a separate lawsuit against Terraform Labs and its founder Do Kwon, for allegedly "orchestrated a multi-billion dollar crypto asset fraud".
In line with the SEC's July 21 response to Terraform Labs' motion to dismiss - in which Ripple Labs' potentially precedent-setting decision was referenced by defendants - the SEC has highlighted a host of issues it holds against the court's recent ruling on XRP.
“Contrary to Defendants' assertions, much of the Ripple decision supports the SEC's assertions in this case and rejects the arguments Defendants have raised here. However, with respect to programmatic and other sales, the SEC respectfully asserts that Ripple is in conflict with Howey and his progeny and adds baseless requirements,” the SEC said, adding that:
“Respectfully, these parts of Ripple were ill-decided, and this Court should not follow them. SEC staff are investigating the various availabilities...
According to court documents, the SEC said it was "now considering the various avenues available for further review" of the decision that found XRP not a security.
News
Join us on social networks
The U.S. Securities and Exchange Commission has suggested it may appeal a recent ruling in the lawsuit by Ripple Labs, which found XRP not to be a security when sold to retail investors.
The SEC argues that the ruling violates "fundamental principles of securities law" such as the Howey test, which determines what does and does not fall within the category of an investment contract.
Do we really want a judge to ask: Does my strict application of the Howey test in this case lead to an outcome in 2023 that matches the policy implications of a 1934 law? https://t.co/acMNRc00B6
— John E Deaton (@JohnEDeaton1) July 22, 2023The SEC's latest comments on Ripple Labs' lawsuit come as part of a separate lawsuit against Terraform Labs and its founder Do Kwon, for allegedly "orchestrated a multi-billion dollar crypto asset fraud".
In line with the SEC's July 21 response to Terraform Labs' motion to dismiss - in which Ripple Labs' potentially precedent-setting decision was referenced by defendants - the SEC has highlighted a host of issues it holds against the court's recent ruling on XRP.
“Contrary to Defendants' assertions, much of the Ripple decision supports the SEC's assertions in this case and rejects the arguments Defendants have raised here. However, with respect to programmatic and other sales, the SEC respectfully asserts that Ripple is in conflict with Howey and his progeny and adds baseless requirements,” the SEC said, adding that:
“Respectfully, these parts of Ripple were ill-decided, and this Court should not follow them. SEC staff are investigating the various availabilities...
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