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The protracted legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) has entered a crucial phase, with U.S. District Judge Analisa Torres recently denying a joint motion from both parties to reduce a civil penalty and vacate a permanent injunction. Following this development, Ripple's Chief Legal Officer (CLO) Stuart Alderoty has provided clarity on the situation, emphasizing that despite the ruling, XRP's legal status remains unchanged.
Judge's Denial and Its Rationale
[embed]https://twitter.com/s_alderoty/status/1938241070204072127[/embed] Judge Torres rejected the joint request, which aimed to lower Ripple's $125 million civil penalty to $50 million and dissolve the injunction imposed on the company's institutional XRP sales. The judge stated that the parties "have not come close" to demonstrating the "exceptional circumstances" required to modify a final judgment that determined a violation of federal law occurred. She further clarified that a private agreement between the parties cannot overrule a court's definitive judgment, asserting that such decisions serve the public interest in enforcing federal securities laws.
Ripple's Stance: XRP's Status Unchanged
In response to the ruling, Stuart Alderoty took to social media, affirming Ripple's position. "With this, the ball is back in our court. The Court gave us two options: dismiss our appeal challenging the finding on historic institutional sales—or press forward with the appeal. Stay tuned. Either way, XRP's legal status as not a security remains unchanged. In the meantime, it's business as usual." This statement underscores Ripple's consistent stance that programmatic sales of XRP to retail investors were not considered securities.
Next Steps in the Legal Saga
The decision means that the $125 million civil penalty and the injunction against institutional XRP sales remain in effect. Both Ripple and the SEC now have the option to withdraw their appeals or proceed with them. The outcome of these choices will significantly influence the final resolution of a case that has had profound implications for the cryptocurrency industry, particularly regarding digital asset classification in the United States. The crypto community remains vigilant as this landmark legal saga approaches its definitive conclusion.