The SEC has signaled plans to appeal Judge Analisa Torres’ decision on the Ripple case.
The United States Securities and Exchange Commission (SEC) has revealed plans to appeal Judge Analisa Torres’ decision on the Ripple case.
According to the SEC, Judge Torres erred by ruling that XRP sales to retail investors are not securities, adding that it is currently considering several options to review the ruling.
The SEC made this known yesterday in its case against TerraForm Labs’ co-founder, Do Kwon.
Recall that Judge Torres, on July 13, declared that XRP itself is not a security. The judge also ruled that the sale of XRP on exchanges does not constitute the sale of securities.
Kwon Uses Judge Torres’ Decision to Beat SEC Charges
Interestingly, TerraForm Labs and its co-founder attempted to use Judge Torres’ decision regarding the security status of XRP as a legal precedent in their ongoing legal tussle against the SEC.
For context, the Securities and Exchange Commission in February accused Kwon of fraud and other legal violations following the collapse of TerraForm Labs.
To dismiss the case, Kwon’s legal team used the recent XRP decision as a precedent to argue that TerraForm Labs’ tokens, including USTC and LUNC, do not constitute securities.
SEC Signals Plans to Appeal Ripple Decision
However, the SEC filed a pleading in the TerraForm Labs’ case yesterday, countering the argument. Notably, the SEC asked the court not to consider the Ripple judgment, stating that Judge Torres erred in her ruling.
The SEC legal team also disclosed in its filing that the commission is seeking to review the decision.
“Respectfully, those portions of Ripple were wrongfully decided, and this court should not follow them. SEC staff is considering the various available avenues for further review and intends to recommend that the SEC seek such review,” an excerpt of the SEC’s filing read.
Notably, the SEC asserted that Judge Torres made a wrong decision and is currently exploring several options to review the ruling.
This is the first time the SEC is categorically stating its next course of action for the Ripple case. The commission and its Chair, Gary Gensler, have previously commented on the Ripple ruling.
As reported earlier, Gensler expressed disappointment in Judge Torres’ decision regarding Ripple’s XRP sales to retail investors.
He further stated that the commission is still assessing the ruling for further action. Following its argument in the TerraForm Labs’ case, there is a likelihood that the commission could file an appeal sooner than expected.
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