SEC Unlikely to Pursue Ripple Lawsuit Appeal, Attorney Jeremy Hogan Predicts.
According to prominent attorney Jeremy Hogan, it appears highly unlikely that the U.S. Securities and Exchange Commission (SEC) will seek to appeal the outcome of its lawsuit against Ripple, a payments company that faced allegations of selling XRP as an unregistered security. The lawsuit, which commenced in late 2020, recently saw Judge Analisa Torres rule that Ripple’s automated open market sales of XRP do not qualify as securities transactions.
While the judge did side with the SEC on the assertion that Ripple’s direct sales of XRP to institutional participants constituted a securities offering, Hogan, who has closely followed the case from the beginning, suggests that neither the SEC nor Ripple are inclined to appeal the judge’s decision. In Hogan’s view, appeals typically occur once a case has reached its conclusive stage, which is not yet the case with the Ripple lawsuit. Following the entry of the “final” judgment, either party has a 60-day window to file an appeal. Given that the case hasn’t reached that stage, any appeal at this point would be considered an “interlocutory appeal.”
Hogan further points out that if Judge Torres believed the ruling to be controversial enough to warrant immediate review, she likely would have certified it for evaluation by the appeals court. Since she did not take that step, Hogan opines that she is unlikely to grant an appeal to either party.
Contrary to the opinions of other legal experts tracking the case, Hogan predicts that neither the SEC nor Ripple will pursue an appeal, and instead, Ripple is expected to settle by paying a fine to the SEC for its direct sales of XRP to institutional clients. When discussing the possibility of an appeal, Hogan notes that many attorneys anticipate the SEC to appeal. However, based on his assessment, Hogan believes that neither side will choose that path. He outlines two primary reasons: First, winning an appeal is challenging, especially considering that Judge Torres had reviewed the comprehensive record of the case. Second, the SEC has more to lose than to gain by appealing. While a successful appeal would retract an adverse trial-level decision, a loss at the appellate level would compel all courts in the 2nd District Court of Appeals to abide by the ruling, potentially magnifying the consequences for the SEC.
Regarding Ripple’s stance, Hogan suggests that the company is unlikely to appeal if it can afford to pay the fine and if the ruling’s impact on its business, particularly the on-demand liquidity (ODL) aspect, remains manageable. Taking all these factors into account, Hogan concludes that the likelihood of an appeal from Ripple is low.
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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.
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