Judge Rejects SEC and Ripple’s Bid to Rework XRP Settlement

A federal court has denied a joint bid of the SEC and Ripple laboratories to approve their settlement, whereby procedural errors were removed, only a few weeks after both parties agreed to drop their profession and to end a legal battle of four years.

Judge Analisa Torres of the American district said on Thursday that, even if she had jurisdiction, she would still deny the motion as ‘procedural incorrect’.

The SEC and Ripple had applied for an indicative ruling, a non-binding signal from the court that it would accept a deal that would resolve the order of Ripple and reduce the $ 125 million fine to $ 50 million.

Such judgments are used when a case is on appeal and the court is no longer authorized to act. In this case, the jurisdiction rested with the second circuit, where both parties submitted Cross-expression after the final judgment in August 2024.

Last month, Ripple Labs and the SEC jointly submitted a request to the second circuit to suspend that appeal while “pursuing a negotiated resolution” of their case.

The submission also confirmed that the SEC would drop the profession in October. However, the second circuit has not yet ruled on that request.

But the recent application to Judge Torres has bypassed Rule 60 of the Civil Procedure, which regulates the exemption from the definitive judgments and does not demonstrate the “exceptional circumstances” under that standard.

“The parties here have made no effort to satisfy that burden; their request does not even state the rule,” Torres wrote in the order of 15 May.

Decrypt has contacted Ripple for comment and will update the story if and when a response is received.

The lawsuit dates from December 2020, when the SEC Ripple accused of collecting $ 1.3 billion via Non -registered XRP Sale.

In July 2023, the Judge Torres ruled that institutional sale violated the securities legislation, but that stock market-based retail did not do, which caused a radius of optimism in the crypto industry.

Since the return from Donald Trump to the office, the SEC has reduced the enforcement of Crypto under the leadership of former acting chairman Mark Uyeda.

Lawsuits against Coinbase, Kraken and many others have been withdrawn, and the new SEC chairman Paul Atkins confirmed by the Senate last month, is expected to take a much smoother attitude than former chairman Gary Gender.

In the announcement of the last week, the SEC formally confirmed the $ 50 million deal. Ripple will pay the reduced fine, with the remaining $ 75 million in Escrow returned to the company.

“Nothing in today’s order changes Ripple’s victories,” tweeted Ripple Clo Stuart Alderoty according to the order of the judge. “Ripple and the SEC are fully in accordance with resolving this case and will visit this issue together with the court.”

XRP, which more than 366% has risen in the past year, fell by 1.6% on the day and traded according to $ 2.42, according to Coingecko data.

Published by Stacy Elliott.