Ripple Files Opposition to SEC’s Motion for Interlocutory Appeal
Ripple Labs Inc. has filed its opposition to the U.S. Securities and Exchange Commission’s (SEC) Motion to Certify Interlocutory Appeal in the ongoing SEC v. Ripple Labs lawsuit. Ripple’s memorandum of law outlined key arguments against the SEC’s motion, stating that the court’s summary judgment order does not present a “controlling question of law” for an interlocutory appeal and that the SEC’s dissatisfaction with the court’s application of the Howey test is not substantial ground for disagreement. Ripple also argued that protracted litigation is inevitable regardless of the appeal’s outcome, making certification unnecessary. The court should deny the SEC’s motion for certification and a stay, according to Ripple.
Key Points:
- Ripple opposes SEC’s motion for interlocutory appeal in the ongoing lawsuit.
- The court’s summary judgment order does not warrant an appeal.
- SEC’s dissatisfaction with the Howey test application is not substantial ground for disagreement.
- Ripple believes protracted litigation is inevitable regardless of the appeal.
- Ripple requests the court to deny the SEC’s motion for certification and a stay.
Ripple’s Potential Cross-Appeal
If the SEC is granted leave to appeal, Ripple intends to cross-appeal on institutional sales, indicating a statutory interpretation issue regarding the scope of the term “investment contract” and the need for rights granted to the buyer or obligations imposed on the seller. Crypto lawyer Bill Morgan highlighted this aspect of Ripple’s memorandum, which suggests Ripple’s strategy for the case.
Background and Lawsuit Updates
The SEC initiated the lawsuit against Ripple Labs Inc. and its senior executives in December 2020, accusing them of unlawfully offering and selling unregistered securities. The court partially granted and denied summary judgment motions from both parties. In a ruling on July 13, 2023, Judge Torres granted the SEC’s motion for summary judgment on Institutional Sales but denied it for other matters. The court also granted Ripple’s motion for summary judgment on Programmatic Sales, Other Distributions, and sales made by Larsen and Garlinghouse. The SEC expressed its intention to file an interlocutory appeal on August 9, and Judge Torres granted the request on August 17. The trial involving the three defendants is scheduled to begin between April 1 and June 30, 2024.
Hot Take
Ripple’s opposition to the SEC’s motion for interlocutory appeal highlights its belief that the appeal would not expedite the end of the litigation and that protracted litigation is inevitable. Ripple’s potential cross-appeal on institutional sales shows its determination to address key issues in the case. The ongoing lawsuit between Ripple and the SEC continues to be closely watched by the crypto community as it may have significant implications for the classification of digital assets as securities.
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