Jeremy Hogan, partner at Hogan & Hogan, has foretold that there will be no “glorious final victory” for the U.S. Securities and Exchange Commission in the U.S. Court of Appeals for the Second Circuit.
Jeremy Hogan, partner at Hogan & Hogan, has foretold that there will be no “glorious final victory” for the U.S. Securities and Exchange Commission in the U.S. Court of Appeals for the Second Circuit.
According to Hogan, the SEC’s attempts to appeal the case could lead to disastrous results for the agency.
Even if the regulator somehow manages to win the appeal, the case would still return to the trial court as further determination of the facts would be necessary.
In a significant blow to the SEC, Judge Analisa Torres determined that the XRP token was not a security when it was sold to retail investors on exchanges in July 2023. However, Torres also ruled that Ripple violated federal securities laws with its sales of XRP to institutional investors. .
Alex DovbnyaLast month, former SEC division chief Kristina Littman opined that the SEC could allow the Ripple ruling to simply “sit there” as a district court opinion without potentially elevating it to a circuit level.
As reported by U.Today, Ripple’s ruling was explicitly rejected by US District Judge Jed Rakoff, who presided over the SEC’s case against Terraform Labs. Judge Rakoff stated that the legal status of a token should not be determined based on whether it is for institutional investors or retailers. This logic was also adopted in the Coinbase decision in a win for the SEC.
Alex DovbnyaTherefore, it remains to be seen whether the SEC will still choose to appeal the case and elevate Torres’ ruling despite scoring several victories. For now, the case remains in the remedies phase, with Ripple attempting to substantially reduce the fines and penalties.
Last July, Gensler hinted that the SEC could end up appealing Torres’ ruling. “We are still analyzing and evaluating it,” he said. saying at that time.
