{"id":23199,"date":"2024-06-21T13:00:14","date_gmt":"2024-06-21T10:00:14","guid":{"rendered":"https:\/\/coinengineer.io\/?p=23199"},"modified":"2024-06-21T09:41:41","modified_gmt":"2024-06-21T06:41:41","slug":"ripple-faces-civil-securities-lawsuit","status":"publish","type":"post","link":"https:\/\/coinengineer.net\/blog\/ripple-faces-civil-securities-lawsuit\/","title":{"rendered":"Ripple Faces Civil Securities Lawsuit Despite Partial Dismissal"},"content":{"rendered":"<p>Denying its summary judgment request in a complaint claiming its CEO violated California securities laws, a United States federal court judge has greenlit a civil securities action against Ripple Labs.<\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_71 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/coinengineer.net\/blog\/ripple-faces-civil-securities-lawsuit\/#False_Statements_Under_Close_Examining_Authority\" title=\"False Statements Under Close Examining Authority\">False Statements Under Close Examining Authority<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/coinengineer.net\/blog\/ripple-faces-civil-securities-lawsuit\/#Discussion_on_the_Security_Situation_of_XRP\" title=\"Discussion on the Security Situation of XRP\">Discussion on the Security Situation of XRP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/coinengineer.net\/blog\/ripple-faces-civil-securities-lawsuit\/#Ripples_Legal_Challenges_and_Industry_Impact\" title=\"Ripple\u2019s Legal Challenges and Industry Impact\">Ripple\u2019s Legal Challenges and Industry Impact<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"False_Statements_Under_Close_Examining_Authority\"><\/span>False Statements Under Close Examining Authority<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The June 20 ruling of California District Court Judge Phyllis Hamilton indicates that jurors will consider whether <strong>Ripple CEO Brad Garlinghouse<\/strong> made &#8220;misleading statements&#8221; in a 2017 interview. Four claims over <strong>Ripple&#8217;s<\/strong> &#8220;failure to register XRP as a security&#8221; have been rejected by the ruling. Garlinghouse said he was &#8220;very, very long&#8221; on XRP in the 2017 interview on Canada&#8217;s BNN Bloomberg, but the lawsuit claims it was untrue as he &#8220;sold millions of XRP&#8221; during the year.<\/p>\n<p>&#8220;We are happy that all class action allegations the California court rejected. Stu Alderoty, Chief Legal Officer of Ripple, indicated that the one surviving state law suit will be handled at trial.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Discussion_on_the_Security_Situation_of_XRP\"><\/span>Discussion on the Security Situation of XRP<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Judge Hamilton pointed out that <strong>XRP<\/strong> is not a security under the Howey test hence the &#8220;misleading statement&#8221; allegation should be denied. This argument cited a historic decision in a <strong>Securities and Exchange Commission (SEC)<\/strong> litigation made in July 2023 by Judge Analisa Torres. Judge Hamilton disagreed, however, and said XRP may be a securities traded to non-institutional investors. One of the indicators used in the Howey test, she added, they would have anticipated earnings from Ripple&#8217;s activities.<\/p>\n<p><a href=\"https:\/\/coinengineer.net\/blog\/midas-launches-new-yield-token-mbasis-to-compete-with-ethena\/\"><em><span style=\"font-weight: 400;\">This Might Interest You: <\/span>Midas Launches New Yield Token mBASIS to Compete with Ethena<\/em><\/a><\/p>\n<p>\u201cThe court declines to find as a matter of law that a reasonable investor would have derived any expectation of profit from general cryptocurrency market trends, as opposed to Ripple\u2019s efforts to facilitate XRP\u2019s use in cross-border payments, among other things.\u201d<\/p>\n<p><strong>Ripple\u2019s<\/strong> Alderoty said, \u201cThe ruling from Judge Torres in the SEC case still stands and nothing here disturbs that decision.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Ripples_Legal_Challenges_and_Industry_Impact\"><\/span>Ripple\u2019s Legal Challenges and Industry Impact<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Believing other courts would take Judge Torres&#8217; decision as precedent when evaluating future crypto cases, many in the U.S. crypto market praised her decision as a major triumph for the field last year. It is not, however, making as significant an effect as predicted. Presiding Judge Jed Rakoff, from the same courtroom as Judge Torres, disagreed with the Ripple decision in the SEC&#8217;s case against Terraform Labs in denying Terraform&#8217;s dismissal request in August. Terraform subsequently lost the action and paid a $4.5 billion SEC settlement.<\/p>\n<p><a href=\"https:\/\/t.me\/coinengineernews\"><em><span style=\"font-weight: 400;\">Click here to get the latest news from Coin Engineer!<\/span><\/em><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Denying its summary judgment request in a complaint claiming its CEO violated California securities laws, a United States federal court judge has greenlit a civil securities action against Ripple Labs. False Statements Under Close Examining Authority The June 20 ruling of California District Court Judge Phyllis Hamilton indicates that jurors will consider whether Ripple CEO<\/p>\n","protected":false},"author":6,"featured_media":12898,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9,657,1,2],"tags":[1390,509],"class_list":["post-23199","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto-news","category-en","category-genel","category-news","tag-lawsuit","tag-ripple"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Ripple Faces Civil Securities Lawsuit Despite Partial Dismissal - Coin Engineer<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/coinengineer.net\/blog\/ripple-faces-civil-securities-lawsuit\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Ripple Faces Civil Securities Lawsuit Despite Partial Dismissal - Coin Engineer\" \/>\n<meta property=\"og:description\" content=\"Denying its summary judgment request in a complaint claiming its CEO violated California securities laws, a United States federal court judge has greenlit a civil securities action against Ripple Labs. 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