The years-long legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) appears to have finally come to an end, after Ripple Labs CEO Brad Garlinghouse announced Friday that the company plans to drop its cross-appeal in the case.
“Ripple is dropping our cross appeal, and the SEC is expected to drop their appeal, as they’ve previously said,” Garlinghouse wrote on X. “We’re closing this chapter once and for all, and focusing on what’s most important – building the Internet of Value. Lock in.”
XRP climbed a modest 1.4% on the news.
The decision comes just a day after U.S. District Judge Analisa Torres of the Southern District of New York (SDNY) rejected a joint request from the SEC and Ripple to approve a proposed settlement agreement that would slash Ripple’s civil penalty to $50 million and dissolve the permanent injunction against the firm. It was the latter that appeared to be the sticking point for Torres, who argued:
“Indeed, if the Court should not be concerned about Ripple violating the law, why do the parties want to eliminate the injunction that tells Ripple, ‘Follow the law’?,” Torres wrote. “When the Court imposed the injunction, it did so because it found a ‘reasonable probability’ that Ripple would continue violating federal securities laws. This has not changed, nor do the parties claim that it has.”
The joint request was the second such request slapped down by Torres, who rejected an earlier attempt in May citing both jurisdictional and procedural flaws. With the court showing no signs of budging on the terms of the settlement, Ripple’s decision to withdraw its cross-appeal ends the case by accepting the initially-imposed civil penalty of $125 million and presumably leaving the permanent injunction against the firm in place.
A spokesperson for Ripple Labs did not immediately respond to CoinDesk’s request for comment.
The SEC first sued Ripple in 2020 under then-Chair Jay Clayton, alleging that the company violated federal securities laws through its sales of XRP. After years of litigation, Torres eventually concluded in a 2023 ruling that the sales of XRP to retail traders on public exchanges did not constitute securities transactions, but found that XRP sales to institutional investors did, thus violating securities laws.