The United States SEC has been granted permission to file an interlocutory appeal against blockchain company Ripple Labs. District Judge Analisa Torres granted this request in a court filing on August 17.
According to the details on the filing, Judge Torres reviewed the letters from both parties and granted the Securities and Exchange Commission’s request to file a motion for leave to file an interlocutory appeal.
Furthermore, the Judge gives the SEC until Friday, August 18 to file this appeal. Ripple Labs will need to file its papers of opposition by September 1 and finally, the SEC will file any reply by September 8.
The court filing did not show the reason why the Judge granted the permission and both parties are directed to comply with the deadlines set forth.
Bill Hughes, a lawyer at ConsenSys made a post on X (formerly Twitter) breaking down the recent filing. He pointed out that the decision does not mean that the SEC can appeal now, rather it means that the court granted it leave to file a motion for leave to appeal.
Because this isn't very clear, the court has not granted leave to appeal – meaning SEC can appeal now.
It granted leave to file a motion for leave to appeal. The court just decided "ya we can deal with this issue".
So, the issue itself – whether an appeal will go forward now -… https://t.co/vBbgr4CaYK
— Bill Hughes : wchughes.eth 🦊 (@BillHughesDC) August 17, 2023
If the SEC wins this motion, it can then ask for permission from an appellate court to file the actual appeal of the XRP ruling.
How did we get here?
The case between the Securities and Exchange Commission and Ripple Labs has been going on since December 2020. The SEC sued Ripple for allegedly offering unregistered securities in XRP.
In July 2023, Ripple obtained a partial victory in the case when the presiding Judge ruled that it did not break federal laws and classified XRP as non-security. The win sent excitement across the crypto community and XRP began trending with lots of positive sentiments around it.
However, the SEC intends to contest the decision. In an August 9 filing, the Commission said it will file an interlocutory appeal to challenge the decision. On August 16, Ripple Labs filed an opposition to the SEC’s expected appeal.
Ripple argues that the regulator’s initial focus, the Howey test application, was diverted by the expected appeal. Additionally, Ripple said that the case could not be resolved via a straightforward application of the law, which it considered essential for any appeal of this nature.
On August 17, the court granted the SEC permission to go ahead and file an interlocutory appeal against Ripple Labs.