Ripple Gives Specifics of its Cross Appeal in New Form C Document; Details

California-based blockchain company, Ripple, has submitted its anticipated Form C, giving details to the points in the previous court ruling it wishes to challenge. Notably, this comes just a few hours after the SEC requested an extension for the deadline for submission of its principle brief.

The legal battle, which has stretched for almost four years, has reached another critical point. Recall that the Securities and Exchange Commission filed its Form C on October 18, arguing the part of the court ruling that declared the programmatic sales of XRP on crypto exchanges as not security. So, what is Ripple’s appeal about?

Ripple Argues Four Points in its Cross Appeal

Defence lawyer, James Filan, shared the Civil Appeal Pre-Argument Statement (Form C) earlier today on X (formerly Twitter). According to the document, Ripple focuses on four issues from the previous court ruling, seeking clarity in each of them. Notably, Ripple asked the court to review these four points from scratch without referring to the district court’s decision.

#XRPCommunity #SECGov v. #Ripple #XRP @Ripple has filed the Civil Appeal Pre-Argument Statement (Form C). The relevant pages are below. pic.twitter.com/usm3fCjG20

— James K. Filan 🇺🇸🇮🇪 (@FilanLaw) October 25, 2024

The first point targets the specifics of an “investment contract.” Ripple sought clarity, asking if an actual contract is required under the Securities Acts of 1933 that imposes post-sale obligations on the seller and gives the buyer rights to receive profits from the seller’s activities. Clarity on this issue will help the future classification of other cryptocurrencies.

Secondly, Ripple asked if the district court “erred” in its previous judgment that some of its XRP transfers fulfilled the three requirements of the Howey test for an investment contract. Recall that the court imposed a fine of $125 million on Ripple for violating federal security laws by offering XRP to institutional investors.

The third point that the cross-appeal focused on is the vague guidelines given by the SEC on cryptocurrency classification. Ripple revived its “Fair Notice” defense, pointing out that the SEC gave “inconsistent and deliberately vague statements” so it shouldn’t be punished for the SEC’s misguidance.

Lastly, Ripple questioned the injunction order issued by the court to ensure that it does not affect the company’s operations. Ripple asked if Rule 65 of the Federal Rules of Civil Procedure does more than direct the enjoined party to obey the law.

The Case Goes Beyond SEC Security Clarification

Ripple’s chief legal officer, Stuart Alderoty, took to X to give some points to keep in mind as the case goes further. According to him, the case goes beyond whether XRP is classified as a security or not. He pointed out that XRP has already been declared as non-security alongside the flagship cryptocurrency Bitcoin, adding that it is already the “law of the land.”

Also, he added that the SEC cannot submit any new evidence and cannot ask Ripple to produce more since the court has already gone through their documents and has certified them. Therefore the crypto community should expect a smooth process with no back-and-forth regarding documents.

Ultimately, Alderoty called SEC’s distraction strategy a “background noise,” stressing that the hard part of the lawsuit is already gone and that Ripple’s business is booming with several international partnerships amid the court process.