Judge Analisa Torres of the Southern District of New York denied a joint request from the U.S. Securities and Exchange Commission (#SEC ) and Ripple to lift a permanent injunction in their dispute, a decision preventing Ripple from significantly reducing its $125 million fine.
Judge Torres cited the previous opinion of the Securities and Exchange Commission that #ريبل will continue to violate the law in her ruling issued today. Torres stated: "This has not changed, and neither party has argued otherwise. However, they request a 60% reduction in the fine and the lifting of the permanent injunction, citing public interest."
The parties had requested that if the permanent injunction against Ripple were lifted, $50 million of the $75 million fine be returned to the U.S. Securities and Exchange Commission, and the remaining $25 million be returned to Ripple.
The lawsuit between the U.S. Securities and Exchange Commission and Ripple began in 2020. The SEC accused Ripple of raising $1.3 billion through unregistered securities sales. In July 2023, Judge Torres ruled that "programmatic sales" of $XRP to individual investors do not constitute securities, while direct sales to institutional investors are considered securities. This ruling resulted in a $125 million fine for Ripple.
In March, Brad Garlinghouse, the CEO of Ripple, announced that the case had effectively ended, and the SEC withdrew its appeal. However, the final stages of the case focused on reassessing the amount of the imposed fine.
The parties had requested a reduction in the fine, pointing to the SEC's change in approach towards cryptocurrencies in the new period. Following the departure of SEC Chairman Gary Gensler, who held the position during Biden's administration, in January, the SEC concluded its investigations and lawsuits against several cryptocurrency firms and began working on creating a regulatory framework by forming a cryptocurrency task force.
But Judge Torres said: "The parties cannot evade the binding force of the court's decision by mutual consent. In such cases, exceptional circumstances must be demonstrated to serve the public interest and achieve justice. This is not the case in this matter."
While the SEC did not comment on the matter, Stuart Alderoty, Ripple's legal director, stated on the social media platform X: "The ball is now in our court." Alderoty explained that the court gave them two options: "Either withdraw our appeal on the findings related to previous institutional sales or continue the appeal." He confirmed that the decision not to consider #XRP a security has not changed. #Ripple #RippleSEC