SEC Asks Judge To Dismiss Lawsuit Against Ripple Executives, But There's Pending Issues

In a significant turn of events, the U.S. Securities and Exchange Commission (SEC) asked the judge presiding over the case to dismiss its lawsuit against Ripple's XRP/USD key executives Christian Larsen and Bradley Garlinghouse.

The decision was conveyed via an official letter to Analisa Torres, a U.S. District Judge for the Southern District of New York, on Thursday.

The lawsuit, which had been looming over Ripple for some time, centered around allegations that Larsen and Garlinghouse aided and abetted Ripple's violations of Section 5 of the Securities Act of 1933 with Ripple's "Institutional Sales" of XRP.

Following a stipulation between the involved parties, the claim is dismissed with prejudice, negating the necessity for the previously scheduled trial.

While this chapter closed for Ripple's top brass, it is not the end of legal proceedings for the company.

The letter from the SEC also mentioned that it, along with Ripple, will deliberate on a potential briefing schedule concerning the appropriate remedies against Ripple for its alleged Section 5 violations tied to its Institutional Sales of XRP.

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The parties have until Nov. 9, 2023, to propose this schedule to the court.

This development came against the backdrop of a string of legal victories for entities in the crypto space against the SEC.

Notably, Ripple had previously secured two consecutive court wins against the SEC, one in July and another earlier this month.

Additionally, Grayscale managed to overturn the SEC's decision regarding the conversion of the Grayscale Bitcoin Trust GBTC into a spot ETF tracking Bitcoin's BTC/USD performance.

Furthermore, it's worth noting that earlier in June, the SEC had also taken legal action against two of the largest cryptocurrency exchanges, Binance BNB/USD and Coinbase Global Inc COIN.

The allegations centered on potential law violations and the provision of trading services with purportedly unregistered securities, including popular cryptos like BNB, Solana SOL/USD, Polygon MATIC/USD, and Cardano ADA/USD.

Garlinghouse in a statement claimed the SEC repeatedly kept its eye off the ball while secretly meeting with the likes of FTX founder Sam Bankman-Fried while "failing again and again" to protect U.S. consumers and businesses.

"In all seriousness, Chris and I (in a case involving no claims of fraud or misrepresentations) were targeted by the SEC in a ruthless attempt to personally ruin us and the company so many have worked hard to build for over a decade," he said.

"The SEC repeatedly kept its eye off the ball while secretly meeting with the likes of SBF — failing again and again to protect U.S. consumers and businesses. How many millions of taxpayer $ were wasted?! Feels good to finally be vindicated," he added.

Meanwhile, reacting to the verdict, Ripple's Chief Legal Officer Stuart Alberoty termed it as a "surrender" by the SEC in a tweet.

"The SEC made a serious mistake going after Brad and Chris personally — and now, they’ve capitulated, dismissing all charges against our executives. This is not a settlement. This is a surrender by the SEC," added.

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