Pro-XRP attorney Jeremy Hogan says the landmark ruling in the U.S. Securities and Exchange Commission (SEC) lawsuit against Ripple will likely survive an appeal.
In a new YouTube interview with Darren Moore Jr. Hogan says Judge Analisa Torres ruled in Ripple’s favor based on the Howey test, while basing her decision on the facts of the case.
He says an appeals court is unlikely to overrule Judge Torres’ findings of fact, giving her decision a good chance of surviving any legal challenge.
“I thought what Judge Torres did was very clever. She made her opinion based on the Howey test. What she said was, “Well, in these programmatic sales, the buyers didn’t know who they were buying from, nor did Ripple know who was buying XRP, and so there was no profit expectation. And so she expressed her opinion in terms of the facts and that is more likely to stick.
That is less likely to be overturned on appeal because you are right, appellate judges don’t like digging into the facts of the case and saying the judge, in this case the judge, was wrong.”
The Howey Test determines whether certain transactions qualify as investment contracts and are subject to securities law.
The SEC sued Ripple in late 2020 for allegedly selling XRP as an unregistered security.
Last week, Torres ruled that Ripple’s automated, open-market sales of XRP are not securities transactions. However, the judge ruled in favor of the SEC when it decided that Ripple’s direct sale of XRP to institutional participants represented a securities offering.
Hogan also says he believes the judge’s ruling legally protects retailers of XRP, but not of other digital assets.
“[Torres] explicitly says that XRP is not a secondary market security. And so she gives us what we really want without making it part of her official order because it really wasn’t for her and I agree with her…
So it protects XRP holders from any argument in the context of XRP that XRP is not a security. Now it’s just a trial level order. So non-XRP digital assets are not covered by this order. So this order only applies to XRP. It does not apply to anything else. Now in those other cases it is persuasive authority, but it is not binding on anyone.”
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