Ripple filed a pre-argument appellate statement outlining four issues it intends to cross-appeal to the SEC.
This development comes two weeks after Ripple revealed that its appeal ensures that “nothing is left on the table.”
Recall that Ripple lost out on the issue of institutional sales of XRP, which was considered an investment contract. As a result of the ruling, a federal court ordered Ripple to block future institutional sales and imposed a $125 million fine.
However, as the SEC appealed the ruling against Ripple (programmatic sales and other distributions of XRP), the payments company also filed a cross-appeal notice specifically challenging the decision regarding institutional sales.
Ripple cross-appeal pre-argument statement
In a filing shared by defense attorney James K. Phelan, Ripple outlined four issues it plans to bring to the Second Circuit on appeal. The company asked the Second Circuit to reconsider the issue independently (without relying on the district court’s decision) from scratch.
#XRPCommunity #SECGov v. #ripple #XRP @ripple filed a pre-argument statement (Form C) in the civil appeal. Related pages are below. pic.twitter.com/usm3fCjG20
— James K. Filan 🇺🇸🇮🇪 (@FilanLaw) October 25, 2024
https://x.com/thecryptabasic
The first issue that Ripple intends to present in the Second Circuit is that the Securities Act of 1933 requires investment contracts to include actual contracts, post-sale obligations, and the right of the buyer to profit from the seller’s efforts. It depends on whether or not there are.
Second, Ripple is seeking to determine whether the district court was wrong to declare that some of Ripple’s XRP-related transactions met the three elements of the SEC’s long-standing securities test Howie. These include the investment of funds in a common business where the buyer expects to benefit from the seller’s efforts.
Third, Ripple’s cross-appeal focuses on its fair notice defense. Specifically, Ripple relied on the SEC’s inconsistent guidance and evidence of regulatory uncertainty to argue that it lacked fair notice as to whether its actions violated federal securities laws. question whether he raised a genuine factual dispute when he presented the following.
Finally, Ripple aims to invalidate the injunction so that it does not affect its future business operations. Ripple questions whether the requirements of Rule 65 bar an injunction by simply directing the enjoined party to comply with the law.
Next steps in the case
Meanwhile, FOX business journalist Eleanor Tellet outlined the next steps in the SEC v. Ripple case. After Ripple files its Form C statement, the Second Circuit will issue an order to schedule the briefing. In an earlier statement, she said the SEC would first file an appeal brief and then Ripple would respond.
Ripple will then file a cross-appeal brief and the SEC will respond to the matter. According to Ripple CLO Stuart Alderroti, the entire briefing could end in July 2025, nine months from now.
Further, Terret argued that the Second Circuit consolidated all relevant filings, including those from the district court.
SEC seeks extension of principal preparation filing
Meanwhile, the US SEC requested the court to extend the deadline for filing the main complaint brief. Notably, the SEC wants to extend the deadline to January 15, 2025, which is currently less than three months.
#XRPCommunity #SECGov v. #ripple #XRP of @SECGov requested that the deadline for submission of the main preparatory documents be January 15, 2025. pic.twitter.com/GP13onXwb5
— James K. Filan 🇺🇸🇮🇪 (@FilanLaw) October 24, 2024
As expected, this development sparked a reaction among XRP supporters, suggesting that the SEC may have resumed its usual delay strategy, as observed at the district court level. However, the court has not ruled on the SEC’s latest request.
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