The SEC has submitted a letter to Judge Analisa Torres of the Southern District of New York, seeking an interlocutory appeal on two unfavorable liability judgments in the Ripple Labs case. The SEC stated that it is seeking an appeal on certain aspects of the ruling, while other parts will proceed to the trial phase. Ripple is required to respond by August 16th, and the SEC will submit an opening brief on August 18th. The SEC stated, “There is a need for interlocutory review here, which involves controlling questions of law upon which there is substantial ground for difference of opinion, and such division reflects in the regional split that has emerged.”
Previously, the United States Southern District Court in New York categorized the tokens sold by Ripple over a span of 10 years into three groups: 1) sales to hedge funds, venture capital, and similar institutional entities; 2) direct programmatic retail sales on digital asset exchanges; and 3) “as a form of payment for services,” such as providing services to employees and other service providers through restricted token purchase agreements or option contracts. The court rendered a summary judgment, determining that selling Ripple's XRP tokens through exchanges and algorithms does not constitute an investment contract (and does not violate securities laws), while institutional sales of the tokens indeed violated federal securities laws.