The United States Securities and Exchange Commission (SEC) has submitted a Form C with attachments to challenge a recent court ruling in its case against Ripple. The agency is no longer contesting XRP’s status as a non-security but wants other parts of the ruling overturned.
Ripple CLO Stuart Alderoty has offered insight into the company’s decision, confirming that it will respond with its filing next week. The review focuses on the use of XRP for sales and as a payment method with the SEC also challenging the ruling in favor of several executives.
SEC revisits Ripple executives’ role in XRP sales
The pre-argument statement is seen as the first step in the formal appeal process. The agency filed it at the United States Court of Appeals for the Second Circuit, with case number 24-2648.
SEC is adamant that the company, alongside its executives Brad Garlinghouse and Chris Larsen, was involved in selling and offering XRP without prior registration. The agency claimed that the act violates Sections 5(a) and 5(c) of the Securities Act.
The document also reads that the executives, Garlinghouse and Larsen, aided and abetted the company’s violations. The court ruled partially in favor of the SEC on Ripple’s sale to institutional investors. Meanwhile, Ripple was granted a partial summary judgment regarding the sales of XRP on exchanges and other transactions.
XRP price remains unchanged amid new developments
The price of XRP has remained unchanged despite the new developments. On CoinGecko, it is steadied around $0.54 and $0.55. However, it has seen a slight 1% decline since the news about the appeal broke out.
A part of the SEC’s appeal is a motion to challenge the reason for partial summary judgment to Ripple. The agency wants the previous ruling to be reviewed, describing it as “erroneous.”
The district court has granted the mandatory 14 days after the appeal to fill the Courts of Appeals Transcript Information/Civil Appeal Form, also called Form D. However, the crypto community remains solidly behind Ripple and is optimistic about a victory for the company.
Attorney Jeremy Hogan has opined that the main focus of the appeal will be on the sale of XRP to exchanges and its use for payments. According to Form C, the matters will be looked into De Novo. This means that they will be critically examined without using the decisions of the trial court, making it an independent review.
Hogan also clarified that the SEC is pushing a weak argument with the Garlinghouse and Larsen angle as it has been thrashed at the trial. He also claims that if Ripple is not successful at the appeal, strict penalties would be meted out to the company.
In the previous ruling, the court did not accept the SEC’s plea for the disgorgement of $876 million in profits from XRP’s sales. However, it plans not to challenge that decision along with some others.