Ripple Files Cross-Appeal Amid Ongoing Legal Clash with SEC

Ripple's chief legal officer, Stuart Alderoty, revealed on social media platform X Thursday that the crypto firm had filed a cross-appeal in its ongoing legal

Cryptocurrency firm Ripple Technologies Inc has escalated its legal battle with the U.S. Securities and Exchange Commission (SEC) by filing a cross-appeal to challenge unresolved issues around XRP sales. The move comes after the SEC last week sought to overturn parts of the rulings that cleared Ripple’s retail XRP transactions from securities violations.

With the cross-appeal, Ripple aims to ensure that the SEC’s arguments on “investment contracts” are fully addressed in the appeals court.

Ripple Chief Legal Officer Stuart Alderoty revealed the filing on social media platform X Thursday. The crypto firm’s filing follows the SEC’s appeal to the U.S. Court of Appeals last Friday. The securities regulator is seeking to reverse portions of District Judge Analisa Torres’ ruling in the Ripple case, which pertains to whether XRP is a security.

“The SEC lost on all key points — that’s why they appealed,” Alderoty explained, adding:

Today, Ripple filed a cross-appeal to ensure nothing’s left on the table, including the argument that there can’t be an ‘investment contract’ without there being essential rights and obligations found in a contract.

As reported, Judge Torres’ ruling found that Ripple’s programmatic sales of XRP to retail investors did not violate securities laws. However, earlier institutional sales were deemed unregistered securities transactions. Both the SEC’s appeal and Ripple’s cross-appeal will be reviewed together in the U.S. Court of Appeals.

“The SEC has already said they aren’t appealing the ruling that XRP itself isn’t a security,” the Ripple legal chief stressed, adding:

(They even apologized in another case for suggesting a token itself could be a security!) That’s the law, and an appeal on these other issues doesn’t change it.

Alderoty further elaborated on the SEC’s previous legal attempts, detailing:

Last year, the SEC unsuccessfully tried to take an early appeal of the rulings that Ripple’s XRP sales on exchanges and Ripple’s other XRP distributions, like to employees and developers, weren’t securities. They’ll likely go after these again — and they will lose on both again.

“We look forward to the federal court of appeals finally putting a stake in the heart of Gensler’s misguided attack on our industry,” he concluded.

The SEC filed a lawsuit against Ripple, its CEO Bradley Garlinghouse, and its co-founder Christian Larsen in December 2020, alleging that they raised over $1.3 billion through an unregistered, ongoing digital asset securities offering. The defendants have denied the allegations.

The lawsuit has been closely watched by the crypto industry as it could set an important precedent for how XRP and other cryptocurrencies are regulated in the future.

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