A New York judge has granted the United States Securities and Exchange Commission (SEC) permission to submit an application for leave to file an interlocutory appeal in its lawsuit against Ripple Labs. This comes a week after the regulator announced plans to request an interlocutory appeal.
Judge Analisa Torres said the SEC can file its motion on Friday, August 18, while Ripple has until September 1 to submit its response to the motion. However, Ripple Labs recently expressed its objection to the SEC’s potential appeal.
Ripple Chief Legal Officer Stuart Alderoty wrote on Twitter that “there is no extraordinary circumstance here that would justify departing from the rule requiring all issues as to all parties to be resolved before an appeal.”
Ripple and the SEC have been engaged in a legal battle since 2020 after the regulator claimed that Ripple had raised $1.3 billion through the sale of XRP, which it claims is an unregistered security.
We oppose the SEC’s request for an interlocutory appeal. There is no extraordinary circumstance here that would justify departing from the rule requiring all issues as to all parties to be resolved before an appeal.
— Stuart Alderoty (@s_alderoty) August 16, 2023
However, Judge Torres ruled last month that Ripple’s programmatic XRP sales weren’t in breach of securities laws. Likewise, she gave the SEC a partial victory by ruling that direct token sales to institutional investors qualified as securities. But the US regulator wants to appeal the judge’s ruling about programmatic sales.
Interestingly, Ripple’s CEO, Brad Garlinghouse, believes that despite the court’s reaction to the SEC’s
appeal, XRP will not be regarded as a security. He wrote in a tweet,
The request for appeal (even if granted) doesn’t change the fact that XRP is not a security. That’s not up for debate / trial. But the SEC continues to claim that Chris and I acted recklessly in believing that XRP is not a security. That’s utter nonsense.
The Judge’s July 13 ruling said that the SEC would be put to their proofs at trial regarding their claim against Chris and me. We look forward to proving the SEC wrong as a matter of fact and law (again). 2/2
— Brad Garlinghouse (@bgarlinghouse) August 16, 2023
It appears that it could take months and possibly years for the SEC’s case against Ripple to be resolved. However, some crypto experts believe the regulator has a tough job convincing Judge Torres or securing approval from the Second Circuit.
