XRP News Today: Ripple and SEC Seek to Modify $125 Million Penalty in XRP Lawsuit

Ripple and the US Securities and Exchange Commission (SEC) have jointly filed a request with the district court to renew their indicative ruling, seeking an order to dissolve the injunction and reduce the penalty as part of their settlement. The parties contend that “exceptional circumstances” exist for modification of the final judgment. In a court filing dated late June 12, the US and Ripple filed with Judge Analisa Torres to reopen the indicative ruling pursuant to Rules 62.1 and 60(b) of the Federal Rules of Civil Procedure. The parties again seek to dissolve the injunction in the Final Judgment and release $50 million from $125,035,150 civil penalty held in the escrow account to the SEC and remaining to Ripple.

The parties asked the court to grant the request so they can move the 2nd Circuit for a limited remand to seek such relief from this court. The filing argues that “exceptional circumstances” — including a settlement, the SEC’s shift in crypto policy, and a desire to avoid further litigation — justify modifying the final judgment. In May, Judge Torres denied the Ripple and SEC’s joint request for an indicative ruling to modify the final judgment in the XRP lawsuit. Judge Torres argued that parties should have filed under Rule 60 to seek relief, but it requires showing exceptional circumstances.

This latest filing has stirred concern among legal experts. Lawyer Fred Rispoli expressed dissatisfaction with the filing, stating, “I don’t like this filing based on how obvious it was from Judge Torres’ last ruling that she was pissed.” He recommended a more detailed motion explaining the SEC’s failures in crypto regulation and some apologies from Ripple for what it got tagged on. Rispoli also asserted that while Ripple and the SEC cite enough law for the court to grant it, the discretion is purely on Judge Torres whether to grant. “I don’t think this gets it done, sadly,” claimed Rispoli. Judge Torres is expected to reply within 2 weeks.

Legal expert Sherrie also sided with Fred Rispoli, saying “While I feel there is a slightly higher chance she’ll come back with something more positive – I am more concerned than I was before.” If it is denied again, Ripple must then decide if they wish to continue with their cross-appeal in 2nd Circuit or not. Former SEC attorneys James Farrell and Marc Fagel claimed that the “extraordinary circumstances mentioned are not enough. Plus, I read the NML case they cite for the proposition that a change in administration supports vacating the injunction… and laughed out loud at how off-point it is. If one of my law students tried that they'd be sent back to do more research.”