Ripple Labs is stepping back from its legal counteroffensive against the U.S. Securities and Exchange Commission (SEC). Today, Ripple CEO Brad Garlinghouse confirmed plans to drop its cross appeal in the long-running XRP lawsuit.
Garlinghouse made the announcement on X, stating: “Ripple is dropping our cross appeal, and the SEC is expected to drop their appeal, as they’ve previously said. We’re closing this chapter once and for all, and focusing on what’s most important – building the Internet of Value. Lock in.”
The development follows a decisive court ruling on Thursday, June 26, when U.S. District Judge Analisa Torres dismissed the SEC’s request. The motion sought to reduce sanctions previously levied against Ripple and to lift an injunction requiring future compliance with securities laws.
In its motion, the SEC had requested two key changes: first, that the court remove the permanent injunction mandating Ripple’s adherence to federal securities law. Second, that the financial penalties imposed on the firm be significantly reduced by more than 50%. Judge Torres denied the request in a brief but direct order, writing simply: “The request is DENIED.”
The ongoing litigation, initiated by the SEC in December 2020, has centered on Ripple’s sale of XRP. Regulators accused the blockchain company of offering XRP as an unregistered security, thereby violating U.S. securities law. At the time, the SEC claimed that the absence of registration deprived potential investors of critical disclosures related to XRP and Ripple’s operations.
According to previous court filings, the commission maintained that investors “were deprived of information about XRP and Ripple’s business that would allow them to make informed investment decisions.”
After nearly three years of legal wrangling, Judge Torres issued a partial summary judgment in July 2023. That decision concluded that the sale of XRP by Ripple to institutional customers was considered unregistered transactions on securities. Sales to the general people, however, under exchanges were not considered as such.
In March 2024, the SEC moved to a final ruling the following month and sought an injunction to permanently prohibit Ripple against further violations of the securities laws and also wanted the court to order the company to pay a stiff monetary award. Now that Ripple has cleared the air that it is removing its cross appeal, and the SEC is expected to follow suit, the legal tussle appears to be getting to an end.