Ripple Labs filed a cross-appeal with the U.S. Court of Appeals for the Second Circuit on October 10 as part of its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC).
The cross-appeal follows the SEC’s own appeal earlier this month, which seeks to overturn the court’s ruling that programmatic sales of XRP to retail investors do not violate securities laws.
Both appeals will now be merged into a single case, further expanding legal proceedings that have captivated the crypto industry since the SEC first filed its complaint in 2020.
Ripple’s appeal challenges the final judgment requiring the company to pay $125 million in civil penalties related to the institutional sale of XRP tokens. While this fine was significantly lower than the nearly $2 billion initially requested by the SEC, it was still significantly higher than Ripple’s own $10 million proposal.
Ripple’s chief legal officer, Stuart Alderoty, posted on social media that the filing of the cross-appeal is intended for this purpose “Nothing is left on the table.”
Alderoty added that the SEC will likely continue the argument that XRP sales on exchanges and token distributions to employees and developers are securities. Furthermore, he showed optimism about the outcome of the appeal, stating:
“We look forward to the federal appeals court finally weighing in on the case [SEC Chair Gary Gensler’s] Misguided attack on our industry.”
Meanwhile, Ripple CEO Brad Garlinghouse said the SEC is only interested in “creating chaos” and avoiding providing clarity to crypto industry players in the US.
He added:
“With our cross-appeal today, we look forward to sealing the SEC’s fate and finally putting an end to the SEC’s rule-by-enforcement agenda.”
Four years of legal battle
The SEC initially sued Ripple in December 2020, accusing the company of unlawfully offering unregistered securities through its XRP token, totaling $1.3 billion.
After years of litigation, the U.S. District Court for the Southern District of New York, Judge Analisa Torres, ruled partially in favor of Ripple in July 2023. She concluded that although institutional sales of XRP violated securities laws, programmatic sales and other distributions of XRP to retail investors did not constitute a securities offering.
As a result, the SEC presented a motion for remedies asking for a $2 billion fine due to Ripple’s actions, which Judge Torres partially dismissed on August 7. Instead, the court imposed a $125 million fine on Ripple and ruled that XRP sales to retail investors did not violate securities laws.
The SEC filed an appeal to overturn the ruling less than two months later, prompting Ripple to file its own cross-appeal.