Major Setback As Court Denies Request From Ripple And SEC To Lift Injunction And Reduce $125M Penalty
A New York Judge has rejected a request from Ripple and the U.S. Securities and Exchange Commission to lift legal constraints on Ripple’s institutional XRP sales, which would have ultimately considerably slashed fines previously demanded by the agency during the Gary Gensler era.
Why The Ripple-SEC Settlement Bid Was Denied
As announced by well-known defense lawyer James Filan, Judge Analisa Torres denied the joint bid by the Securities and Exchange Commission and Ripple for an indicative ruling.
In the June 26 five-page order filed in the U.S. District Court for the Southern District of New York, Judge Torres pointed to the SEC’s previous stance against Ripple involving claims that Ripple would likely continue to break federal laws in pushing for an injunction.
“None of this has changed — and the parties hardly pretend that it has. Nevertheless, they now claim that it is in the public interest to cut the Civil Penalty by sixty percent and vacate the permanent injunction entered less than a year ago,” Judge Torres stated in the order.
The SEC and Ripple have been requesting that Judge Torres grant their request and issue a ruling that the court “dissolve the injunction against Ripple,” allowing the company to pay a $50 million civil penalty to the SEC, with the remaining funds to be returned to Ripple.
Torres rejected the parties’ first motion for failing to demonstrate the “exceptional circumstances” required to justify modifying a final judgment.
In their joint motion, the SEC and Ripple mentioned other crypto-related suits where the regulator had voluntarily tossed out their cases since Chairman Gary Gensler left office in January, as the Trump administration rolled in. However, Judge Torres argued that those cases never reached a final judgment, unlike the Ripple case. In each instance, the SEC withdrew before any court found that a legal breach had transpired.
The Court is not persuaded. For starters, none of the enforcement actions cited by the parties involved an injunction or a civil penalty. In each of those cases, the SEC dismissed its case before a court found a violation of federal securities laws,” she wrote.
Judge Torres also rejected the idea that a shift in SEC policy or a newly created crypto task force justified dissolving the injunction.
She stressed that final court rulings are a matter of public interest, particularly when enforcing federal laws that safeguard investors. Amending the penalties would send the wrong message to other companies considering following securities laws.
“The parties must show exceptional circumstances that outweigh the public interest or the administration of justice. They have not come close to doing so here,” the Judge explained.
XRP was trading at $2.11 on Thursday, down 3.2% over the previous 24 hours, according to CoinGecko.
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Major Setback As Court Denies Request From Ripple And SEC To Lift Injunction And Reduce $125M Penalty
A New York Judge has rejected a request from Ripple and the U.S. Securities and Exchange Commission to lift legal constraints on Ripple’s institutional XRP sales, which would have ultimately considerably slashed fines previously demanded by the agency during the Gary Gensler era.
Why The Ripple-SEC Settlement Bid Was Denied
As announced by well-known defense lawyer James Filan, Judge Analisa Torres denied the joint bid by the Securities and Exchange Commission and Ripple for an indicative ruling.
In the June 26 five-page order filed in the U.S. District Court for the Southern District of New York, Judge Torres pointed to the SEC’s previous stance against Ripple involving claims that Ripple would likely continue to break federal laws in pushing for an injunction.
“None of this has changed — and the parties hardly pretend that it has. Nevertheless, they now claim that it is in the public interest to cut the Civil Penalty by sixty percent and vacate the permanent injunction entered less than a year ago,” Judge Torres stated in the order.
The SEC and Ripple have been requesting that Judge Torres grant their request and issue a ruling that the court “dissolve the injunction against Ripple,” allowing the company to pay a $50 million civil penalty to the SEC, with the remaining funds to be returned to Ripple.
Torres rejected the parties’ first motion for failing to demonstrate the “exceptional circumstances” required to justify modifying a final judgment.
In their joint motion, the SEC and Ripple mentioned other crypto-related suits where the regulator had voluntarily tossed out their cases since Chairman Gary Gensler left office in January, as the Trump administration rolled in. However, Judge Torres argued that those cases never reached a final judgment, unlike the Ripple case. In each instance, the SEC withdrew before any court found that a legal breach had transpired.
The Court is not persuaded. For starters, none of the enforcement actions cited by the parties involved an injunction or a civil penalty. In each of those cases, the SEC dismissed its case before a court found a violation of federal securities laws,” she wrote.
Judge Torres also rejected the idea that a shift in SEC policy or a newly created crypto task force justified dissolving the injunction.
She stressed that final court rulings are a matter of public interest, particularly when enforcing federal laws that safeguard investors. Amending the penalties would send the wrong message to other companies considering following securities laws.
“The parties must show exceptional circumstances that outweigh the public interest or the administration of justice. They have not come close to doing so here,” the Judge explained.
XRP was trading at $2.11 on Thursday, down 3.2% over the previous 24 hours, according to CoinGecko.
Read More