The End Kicks In – SEC Files Final Response In Ripple Case

The legal battle between Ripple and the US Securities and Exchange Commission (SEC) has moved to the waiting phase for the final court verdict on the long-existing lawsuit.

According to the latest update, the SEC has filed its final response for the remedies phase. After discussing the necessary redactions with Ripple’s counsel, the regulator submitted its documents. 

SEC Counters Ripple’s Opposition To Its Opening Brief

After deliberating with Ripple’s counsel the previous day, the SEC filed its final reply in the Ripple XRP case. In its filing, the SEC contested Ripple’s opposition to its opening remedies brief, arguing that the court should grant its initial request for an injunction. 

Further, the SEC highlighted the possibility of Ripple’s violation of laws through its institutional sales of XRP. Also, SEC elaborated that Ripple’s business activities hover around XRP sales to institutional customers such as ODL clients. 

The injunction would serve as a check against any future violation of the law by the company. Also, the SEC reported that Ripple has failed to act according to the court’s order regarding its post-complaint ODL sales. 

The regulator pointed out that the blockchain firm should have focused more on non-securities programmatic XRP sales. However, Ripple has continued selling XRP to institutional customers, which the court declared a form of investment contract.

The blockchain payment company has opposed the regulator’s demand for an injunction and disgorgement, saying they are unwarranted. Further, the firm requested that the court reduce the civil penalty to $10 million from the original $876 million.

However, the SEC waved off Ripple’s request for the court to approve just $10 million as the civil penalty. The regulator argued that such a “negligible” penalty is unfit for the firm’s violations.

Pro-XRP Attorneys React To SEC’s Filing

Following the SEC’s final response in the Ripple case, some prominent attorneys reacted on the X platform. In a recent post, Attorney Bill Morgan stated that the probability of the court granting the SEC’s permanent injunction request is high.

The SEC Reply is quite interesting and in some respects on the injunction issue compelling.

1. The issue of financial harm

This issue is relevant to whether there should be any disgorgement. This requires that there be some financial harm to institutional buyers of XRP from…

— bill morgan (@Belisarius2020) May 8, 2024

According to him, such an action would negatively impact Ripple’s ODL sales of XRP. However, Morgan still thinks it’s wrong for the court to categorize ODL sales as investment contracts. 

He also blamed Ripple for failing to differentiate between programmatic and institutional sales during the summary judgment phase of the case.

The lawyer believed that the blockchain firm could handle the matter on appeal. 

Apart from Morgan, XRP advocate and attorney Jeremy Hogan reacted to the filing, noting that the SEC’s response marked the end of the briefs. According to him, the regulator brought nothing new in its debate.

While keeping the end in view, Hogan stated: “Just waiting for The Judge now!“

The Ripple v. SEC briefs are FINISHED!

And I think the SEC went out with a whimper here.

It didn’t even try to attack ODL sales, just noting that Ripple was trying to re-litigate the issue (which it is).

And it brought nothing new on damages.

Just waiting for The Judge now! https://t.co/r8nxNMTzqj pic.twitter.com/Futa93lXUb

— Jeremy Hogan (@attorneyjeremy1) May 8, 2024