Ripple will drop cross-appeal in SEC case, get refund from lower court ruling

Blockchain firm Ripple Labs’ case with the US Securities and Exchange Commission (SEC) may be officially wrapped up after more than four years, subject to court approval.

In a March 25 X post, Ripple chief legal officer Stuart Alderoty wrote, in ” What should be my last update on SEC v. Ripple ever,” that Ripple will drop its cross-appeal against the SEC in the US Court of Appeals for the Second Circuit.

An August 2024 judgment from the US District Court for the Southern District of New York finding Ripple liable for $125 million will essentially stand, but the SEC will keep only $50 million of the amount in escrow. The remaining balance will be returned to Ripple.

“The agency will also ask the Court to lift the standard injunction that was imposed earlier at the SEC’s request,” wrote Alderoty. “All subject to Commission vote, drafting of final documents and usual court processes.”

Ripple chief legal officer statement on latest development with SEC case. Source: Stuart Alderoty

Alderoty’s announcement came less than a week after Ripple CEO Brad Garlinghouse said the SEC would drop its appeal over the August 2024 judgment. At the time of publication, neither the SEC nor Ripple appeared to have made any filing in the Second Circuit since Jan. 31 or in SDNY since October.

The Ripple CLO told Cointelegraph on March 11 that both the SEC and blockchain firm agreeing to drop their respective appeal and cross-appeal would allow the lower court’s $125-million judgment to stand. However, both parties could go “hand-in-hand” to SDNY Judge Analisa Torress to request a modification of the judgment.

Related: Coinbase asks appeals court to rule crypto trades aren’t securities

The SEC v. Ripple case, filed by the commission under US President Donald Trump in December 2020, was one of the agency’s longest-running enforcement cases against a major US crypto company. 

Garlinghouse said in an interview aired in December 2024 that the firm may not have gotten as involved in US politics if the commission had been led by someone other than former SEC Chair Gary Gensler, despite the Ripple case being filed under then-Chair Jay Clayton.

During the 2024 election cycle, Ripple contributed $45 million to the political action committee Fairshake to support “pro-crypto” candidates and pledged $5 million in XRP to Trump’s inauguration fund. Alderoty suggested to Cointelegraph that the SEC dropping cases was “independent” of any political donations.

Since the Nov. 5 election in which Trump defeated then-Democratic Vice President Kamala Harris, Garlinghouse and Alderoty have attended Washington, DC events during the inauguration as official guests, and the CEO joined in a March 7 summit at the White House in which Trump discussed his plans for stablecoins and a crypto regulatory framework.

On March 27, members of the Senate Banking Committee will consider the nomination of former SEC Commissioner Paul Atkins to return to chair the agency. He is expected to face questions about crypto regulation positions and potential conflicts of interest.

Magazine: Ripple says SEC lawsuit ‘over,’ Trump at DAS, and more: Hodler’s Digest, March 16 – 22