Ripple vs SEC: Legal Experts Predict Verdict and Possible Appeals

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As the SEC vs Ripple legal lawsuit nears a potential conclusion, lawyers are now weighing in on the next steps. Unless there’s some unexpected development by the SEC, experts predict the much awaited final verdict would possibly come in July. Lawyers are of the opinion that the SEC will likely appeal the summary judgement, which was ruled by Judge Torres and stated that XRP’s programmatic sales are not actually security contracts. In fact, this ruling has set the stage for legal operations in the future.

Pro-XRP lawyer Fred Rispoli predicts a ruling by Judge Toress on remedies by the end of July or early August. He also added that Judge Torres might as well deliver her decision on July 13. The SEC has been demanding a high penalty of $2 billion as Ripple argues that it shouldn’t be anything more than $10 million. 

In addition, Rispoli stated that it is unlikely to have a pre-judgement settlement though a possibility still remains for resolving arguments not addressed by the judges. In fact, the SEC can still appeal against the ruling of programmatic sales but can’t pose a challenge to the dismissal of claims against the executives of Ripple, Brad Garlinghouse and Chris Larsen.

Former SEC securities lawyer Marc Fagel claimed that the SEC can be expected to appeal the summary judgement on the liability of XRP, as the agency doesn’t agree with the interpretation of Judge Torres of the Howey test regarding XRP. Moreover, Fagel stated that an appeal on the remedies order is quite possible but remains unlikely. 

Similarly, the expert witness motion is still controversial. Lawyers such as Bill Morgan and Jeremy Hogan opine Ripple will most probably lose the motion to exclude the testimony of expert witness Andrea Fox. However, it was mentioned by Fred Rispolu that Judge Toress could also not touch upon this issue if her final ruling is in the favour of Ripple.

The recent settlement between Terraform Labs and the SEC has had a prominent impact on the SEC vs Ripple lawsuit. Terraform and its co-founder Do Kwon were imposed with a penalty of $4.47 billion, which has sparked controversy within the crypto community. In fact, critics like Coinbase CLO Paul Grewel and Ripple CLO Stuart Alderoty, are of the opinion that the heavy fine demanded by the SEC was unfair and has no meaningful result in providing relief to fraud victims. 

The crisis of Terra Luna also wiped out $40 billion in investor wealth, resulting in scrutiny of the SEC’s enforcement actions. Moreover, James Farrel, the former SEC lawyer has stated that the injunction in the Terraform case is quite similar to the arguments of Ripple, especially about penalty proportionality. Hence, Ripple holds firm that a fine more than $10 million would be excessive, keeping in mind the precedents in similar prior crypto cases.

Also, check out: Ripple vs SEC Lawsuit: Can $2B Fine Be Reduced? Will Terraform Labs Settlement Influence Outcome?