XRP Lawsuit: Ripple, SEC Agree On Stay Order For Filing Appeals

In the latest development of the XRP Lawsuit, Ripple has asked the court for a stay order on the $125 million payment it owes the US SEC, just days before the deadline. The request for a stay comes after Judge Analisa Torres ordered the payment last month. However, now both Ripple and the SEC appear to be on the same page, agreeing to put the payment on hold while they prepare to take their fight to the next level, a potential appeal.

The company earlier denied any intention to file an appeal and Ripple CEO Brad Garlinghouse doesn’t believe the SEC will appeal the rulings. However, former SEC lawyers were confident about an appeal by the government agency before the 60-day deadline.

Ripple and US SEC Seek A Stay Order in XRP Lawsuit

On September 4, Ripple Labs sent a letter to Judge Torres that it needs a stay of the monetary portion of the court’s judgment entered on August 7 after the remedies phase. The company and the SEC seek the order before September 6, the last date to pay $125 million in penalties to the SEC.

Lawyer Fred Rispoli confirmed that the odds of an appeal in XRP lawsuit have increased with the filing. Ripple and the SEC have agreed to an arrangement where 111% of monetary judgment will be held in trust. This will be paid to the SEC on 30 days after the appeal deadline or after the appeal concludes.

Former SEC lawyers James Farrel and Marc Fagel were confident about an appeal by the US SEC. As per an order by Judge Torres, the SEC can appeal the remedies ruling or other decisions within 60 days from the date of the order on August 7. Experts believe the government agency would file an appeal against remedies or a summary judgment last year.

Commenting on the development, lawyer Jeremy Hogan has weighed in on the SEC’s delay in filing a Notice of Appeal, suggesting that the regulator may still be deciding whether to appeal the court’s ruling. Hogan notes that filing a Notice of Appeal is a straightforward process that can be completed in just 15 minutes, followed by a 70-day window to file the actual brief.

If the SEC had already decided to appeal, there would be no reason to delay filing the Notice, especially given the perceived negative implications of the ruling. Considering that, Hogan suggested that the US SEC has not yet decided whether to file an appeal.

What Happens If SEC Files An Appeal And Loses

XRP community raised many questions to lawyers on the odds of an appeal. If there is an appeal in the XRP lawsuit and if Ripple wins on every issue over the SEC, aside from returning the $125 million penalty to Ripple, does the SEC have to pay statutory interest?

Former SEC lawyer James Farrell explained that Ripple would stay payment of judgment pending appeal and might post a bond securing. If SEC loses, then the cost of the bond would typically be charged as part of the costs of appeal under FRAP 39 at the discretion of the 2nd Circuit Court like any bill of costs.

However, this needs a cross-appeal by Ripple. But if Ripple does not cross-appeal, it is admitting that it owes $125 million. Thus, there is nothing the appeals court can do for issues not before it.

Meanwhile, as part of the agreement, Ripple will place the $125 million in escrow, which will be released if the SEC does not appeal by the deadline. This arrangement, as highlighted by XRP enthusiast JackTheRippler, serves as insurance for Ripple, providing a safeguard against the potential financial burden of the fine.

Can XRP Price Recover?

XRP price pared earlier gains reducing recovery to 1% after the latest development in the XRP lawsuit. The price currently trading at $0.55. The 24-hour low and high are $0.539 and $0.564, respectively. Furthermore, the trading volume has decreased by 15% over the last day, indicating a decline in interest among traders.

XRP price could crash if it falls below the support level at $0.5326. A break below this level would confirm the bear flag and likely trigger a 15% drop to $0.47. In order to negate this, the price needs to rise above $0.565 and reclaim $0.57, a Fibonacci 0.382 level.