Penny Stock Trader Files Emergency Motion in Ripple vs SEC Case

In the ongoing legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC), a dramatic turn has occurred with the filing of an emergency motion by a non-party to the case. Justin W. Keener, a penny stock trader who was previously penalized $10 million by the SEC, has submitted a letter to the U.S. District Court for the Southern District of New York, claiming to possess crucial evidence that could significantly impact the outcome of the case in favor of Ripple.

Keener's filing, made on April 3, 2025, introduces new information that could potentially alter the course of the legal dispute. The motion seeks to bring to light facts that could support Ripple’s defense against the SEC's allegations. This development adds a new dimension to the already complex legal battle, which has seen Ripple agree to pay a $50 million fine in exchange for the SEC's intention to urge Judge Analisa Torres to lift the long-standing “obey the law” order.

In his filing, Keener asserts that he has important observations that could shed light on significant issues in the Ripple case. He claims that his knowledge, stemming from his background in securities regulation and his familiarity with the Howey test and investment contracts, could be beneficial to Ripple, the broader cryptocurrency industry, and even U.S. politicians. Keener's proprietary information, which he believes to be decisive evidence, could potentially settle controlling questions and matters central to the case.

Keener's unique data on physical investment contracts could play a key role in the Ripple case, potentially benefiting the crypto sector and politicians in Congress. However, he has not provided details about the evidence or how it pertains to Ripple. This filing could sway the direction of a lawsuit of great import for U.S. crypto policy, although the specifics of the evidence remain unclear.

Despite the ongoing legal drama, the price of XRP has remained stable. This stability comes after a partial settlement in which Ripple agreed to pay $50 million worth of fines to the SEC and continue litigating the other charges in court. The calm market reaction indicates that investors are holding out for the eventual ruling instead of responding to each new development. If the court favors Ripple, it would constrain the SEC’s ability to regulate cryptocurrency by lawsuit. If the filing is rejected, though, it could solidify the Commission’s current enforcement strategy.

Neither Ripple nor the SEC has responded to Keener’s lawsuit as of yet, and it is not clear if the court will give his allegations consideration. The Ripple lawsuit, which is already among the most closely followed crypto cases in the U.S., continues to yield surprising developments. Keener’s entry provides another twist in the ongoing litigation saga, since he makes inaccurate allegations and is not a clean player.