SEC Moves to Dismiss Lawsuit Against Ripple’s Brad Garlinghouse and Chris Larsen
The United States Securities and Exchange Commission (SEC) has announced its intention to dismiss all claims against Ripple CEO Brad Garlinghouse and executive chair Chris Larsen. The SEC, in its filing to the U.S. District Court for the Southern District of New York, stated that the parties involved in the case have agreed to dismiss the claims “with prejudice,” indicating that there will be no trial. However, it is important to note that the SEC has not dropped its civil case against Ripple itself, which was initially filed in 2020.
In response to the SEC’s filing, Ripple’s chief legal officer, Stuart Aldeorty, described it as a “surrender” rather than a settlement. Ripple released a statement referring to the SEC’s decision as a “stunning capitulation.” Brad Garlinghouse, in a post on X (formerly Twitter), stated, “Today was an even better day. Ripple: 3 SEC: 0.” He further criticized the SEC’s attempt to ruin him and the company without any claims of fraud or misrepresentations.
The SEC’s Actions on Ripple
The SEC’s actions against Ripple began in December 2020 when it filed a lawsuit against Garlinghouse, Larsen, and the company. The lawsuit primarily focused on the sales of Ripple’s XRP tokens, which the SEC alleged to be securities. However, in July, a federal judge ruled that XRP was not a security when sold to retail investors. The reason behind the SEC’s decision to drop the charges after nearly three years, just before the trial, remains unclear.
It is speculated that the SEC’s dismissal of the claims against Garlinghouse and Larsen could indicate a plan to appeal the court’s decision regarding XRP’s status as a security. Katherine Kirkpatrick, the chief legal officer of Cboe Digital, suggested that such an appeal would have had to wait until the conclusion of the trial.
Other Cases by the SEC
In addition to its case against Ripple, the SEC has pending cases against other high-profile figures in the crypto space. For example, former Celsius CEO Alex Mashinsky is scheduled to face a criminal trial in September 2024, while former FTX CEO Sam Bankman-Fried’s trial is expected to resume on October 26. The SEC has also filed civil lawsuits against leading crypto exchanges Binance and Coinbase.
Overall, the latest development in the SEC’s case against Ripple’s Brad Garlinghouse and Chris Larsen raises questions about the future of the litigation and the potential implications for XRP’s status as a security. It remains to be seen how the SEC’s actions will unfold and the impact they will have on the broader cryptocurrency industry.
The dismissal of the lawsuit against Ripple’s leadership is a significant development in the ongoing battle between the SEC and Ripple. It highlights the growing scrutiny and regulatory challenges faced by companies operating in the cryptocurrency space. As the regulation landscape evolves, it is crucial for businesses and individuals to stay informed and compliant. For the latest news and updates on the cryptocurrency industry, visit Uber Crypto News.