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The United States Securities and Exchange Commission faces a minimal likelihood of succeeding in its appeal against Ripple in the ongoing litigation, as stated by attorney Bill Morgan, who has been monitoring the case closely.
Morgan, in a message on X (formerly Twitter), contended that there is no clear appellable error except in “Ripple’s favor concerning ODL sales that do not satisfy at least two criteria of the Howey test,” while estimating the SEC’s chances of winning the appeal against Ripple at a mere 3%.
I don’t observe any evident appellable error other than in Ripple’s favor regarding ODL sales which do not meet at least two prongs of the Howey test. The SEC’s likelihood of success on appeal is very slim, and I am feeling generous today, so I am assigning it a 3% chance of success on appeal https://t.co/FRIFbqzmVA
— bill morgan (@Belisarius2020) October 22, 2023
Morgan’s assessment followed a statistic shared by Jeremy Hogan, a well-known attorney, who provided government data on the success rates of appeals in various types of lawsuits. The information indicates that the SEC has a 14.2% chance of prevailing in its appeal against Ripple.
The SEC engaged in a protracted legal battle with Ripple for three years before a judge determined that the sale of XRP on cryptocurrency exchanges does not breach securities law. This ruling represented a significant victory for Ripple, which experienced a considerable loss of business during the SEC lawsuit in the U.S. as major cryptocurrency exchanges removed XRP (XRP) from their platforms.
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The SEC also faced a setback in its appeal against the ruling in which Judge Analisa Torres concluded on Oct. 4 that the regulatory body did not fulfill its obligation to demonstrate that there were controlling legal questions or substantial grounds for differing opinions on the ruling.
Related: Lawyers debate over Ripple case after rejection of SEC’s motion for appeal
Subsequently, on Oct. 19, the SEC sought to dismiss all charges against Ripple CEO Brad Garlinghouse and executive chair Chris Larsen, marking another significant triumph for Ripple and its leadership.
Today was an even better day.
Ripple: 3
SEC: 0
In all seriousness, Chris and I (in a case involving no claims of fraud or misrepresentations) were targeted by the SEC in a relentless effort to personally damage us and the company that many have worked hard to build for over a… https://t.co/YsQxewFnj9— Brad Garlinghouse (@bgarlinghouse) October 19, 2023
Ripple’s chief legal officer Stuart Alderoty referred to the SEC’s action as “a surrender,” while Ripple, in its official statement, characterized the SEC’s decision as a “stunning capitulation.”
Morgan remarked that the SEC has dropped the remaining aspects of the case, indicating that there will be no trial next year, and speculated that the court might issue a “final judgment (probably) sometime next year.”
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