Ripple’s Chief Legal Officer Responds to SEC’s ‘Unfair’ Enforcement Practices in XRP Lawsuit Updates
The U.S. Securities and Exchange Commission (SEC) has submitted its final remedies brief in response to Ripple Labs’ brief, focusing on the need for permanent injunctions and disgorgement. This has led Ripple’s Chief Legal Officer, Stuart Alderoty, to criticize the SEC’s commitment to fair application of the law.
The SEC argues in its final brief that “permanent injunctions” are necessary because there is a “reasonable likelihood” that Ripple will repeat its wrongdoings. It claims that Ripple’s primary business, unregistered sales of XRP, has remained unchanged since 2013. The SEC suggests that even if Ripple has not committed any violations since 2020, another violation could still occur.
In response, Ripple asserts that it has made necessary changes to its business model to prevent future violations. However, the SEC disputes this claim, stating that Ripple’s changes are merely an attempt to relitigate previous arguments.
Based on these arguments, the SEC seeks to impose a permanent injunction on Ripple Inc. to prevent it from operating its business.
Stuart Alderoty, Ripple’s Chief Legal Officer, criticizes the SEC’s approach, accusing them of failing to apply the law faithfully and disregarding international regulatory frameworks. He suggests that the SEC has no respect for financial regulators outside the U.S. who have established comprehensive crypto licensing frameworks.
In its final brief, the SEC maintains its demand for $2 billion in penalties and fines, citing Ripple’s profits from unregistered sales of XRP as the basis for disgorgement. The SEC argues that Ripple’s violations have caused pecuniary harm to investors.
Ripple, on the other hand, proposes a significantly lower penalty amount, suggesting that a fine under $10 million would be more appropriate. They argue that the SEC’s demands are excessive.
Despite the ongoing legal battle, Alderoty expresses hope for a resolution. The final court ruling, to be determined by Judge Sarah Netburn, will determine whether the SEC’s injunctions and disgorgement claims are upheld or if a settlement will be reached, setting a precedent for future enforcement actions in the crypto industry.