XRP Lawsuit Set To Linger As Judge Torres Rejects Settlement Agreement

In a major development, Judge Analisa Torres has ruled on Ripple and the SEC’s joint motion for an indicative ruling, denying the request from both parties. This provides a setback for both parties, which had earlier reached a settlement agreement in the long-running XRP lawsuit.

Judge Torres Denies Request For Indicative Ruling In XRP Lawsuit

In an X post, defense attorney James Filan revealed that Judge Torres has denied Ripple and the SEC’s joint motion for an indicative ruling. The court refused to grant both requests to dissolve the permanent injunction against the crypto firm and to reduce the monetary penalty.

This ruling comes just two weeks after Ripple and the SEC refiled their motion for an indicative ruling after Judge Torres rejected the first one on procedural grounds. However, this time around, the judge indicated that the arguments from both parties didn’t show ‘exceptional circumstances’ to warrant an indicative ruling.

Judge Torres noted that the rule, which provides for District courts to only modify judgments in extraordinary circumstances, requires strict interpretation if the justice system is to preserve the finality of judgments.

She also cited a Supreme Court ruling that emphasized that a court’s judgment isn’t just merely the property of private litigants but one that “belongs to the legal community as a whole.”

The judge suggested that a settlement agreement between Ripple and the SEC in the XRP lawsuit isn’t sufficient grounds to modify her judgment. She also alluded to the fact that the Supreme Court had declared that a final judgment should stand unless the court concludes that the public interest would be served by a “vacatur.”

Court Highlights Huge Turnaround From SEC

Furthermore, Judge Torres alluded to the SEC’s arguments in the earlier stages of the XRP lawsuit, noting how the Commission had argued that an injunction and monetary penalty were in the public interest.

She suggested that the new arguments from the SEC were out of place, considering the strong case it had made earlier against Ripple. The judge declared that the crypto firm indeed violated the law, which is why the penalty was necessary in the first place.

Secondly, she noted that the Commission also argued for a permanent injunction because it believed that Ripple’s actions were reckless and likely to continue without the injunction. The SEC also claimed back then in the XRP lawsuit that the crypto firm’s likelihood to keep violating securities laws without an injunction would hurt investors.

Judge Torres declared that nothing had changed and that “the parties hardly pretend that it has.” Ripple had filed a supplemental letter in which it argued that it would still be subject to securities laws with or without the injunction.

The court declared that the crypto firm shouldn’t be bothered by an injunction, which is simply telling it to follow the law. She rejected other arguments about the injunction and monetary judgment being related only to unique parts of the case and not to public interest, and that the SEC has dropped other cases.

Judge Torres stated that both parties can simply drop their appeals if they genuinely want to end the XRP lawsuit. If not, they can simply proceed with the appeal if they want relief from her judgment.

Ripple CLO Reacts To The XRP Lawsuit Ruling

In an X post, Ripple CLO Stuart Alderoty reacted to Judge Torres’ ruling in the XRP lawsuit. He stated that the ball is back in their court, seeing as she gave them two options. They can either dismiss their appeal or challenge the ruling on institutional sales and press forward with the appeal.

Alderoty asked the XRP community to stay tuned for their next move. Meanwhile, he noted that either way, XRP’s legal status as not a security remains unchanged. Legal expert Bill Morgan also earlier clarified that the court ruling won’t impact XRP’s legal status.