The U.S. Securities and Exchange Commission (SEC) has taken steps to appeal previous court decisions regarding the distribution of Ripple's XRP token.
The agency filed a preliminary civil appeal (Form C).
In December 2020, the SEC filed a lawsuit against Ripple, accusing the company of selling $1.3 billion in unregistered securities in the form of XRP. CEO Brad Garlinghouse and co-founder Chris Larsen were also named as defendants in the case.
In July 2023, Judge Analisa Torres of the Southern District of New York ruled that programmatic sales and other distributions of the Ripple token did not constitute the offer and performance of investment contracts. However, according to the ruling, the sale of coins to large players violated U.S. securities laws.
The court rejected the SEC's interlocutory appeal, finding that it lacked sufficient evidence and that its consideration would not "substantially advance the ultimate dismissal of the case."
The Commission subsequently withdrew the suit against Garlinghouse and Larsen. The parties entered into a settlement agreement, which precluded further prosecution on the same grounds.
In August 2024, Judge Torres issued a final ruling in the case, fining Ripple $125 million. The regulator had initially sought $2 billion. In October, the SEC appealed the verdict.
In its Form C filing, the department asks to revisit the court's earlier decisions for erroneous application of the law, including the offering and sale of XRP on digital asset platforms, Garlinghouse and Larsen's involvement, and distributions of the token "in exchange for consideration other than cash."
"These issues must be considered de novo," the statement said.
Ripple's chief legal officer Stuart Alderothy said the SEC's move was not a surprise and the company will file its Form C next week.
"The court's decision that XRP is not a security cannot be appealed. This verdict remains the law of the land," he stressed.
Recall that Alderoti has already expressed similar confidence in the context of possible appeals against Torres' final order in the case.
