Top Ripple Lawyer Anticipates Outcome of SEC Appeal
Stuart Alderoty, the chief legal officer at Ripple, a San Francisco-based enterprise blockchain company, is confident that the United States Court of Appeals for the Second Circuit will either uphold Judge Analisa Torres’ ruling or potentially extend it. Alderoty believes that a “remand,” whereby a higher court sends an appeal back to a lower court, would be the best possible outcome for the Securities and Exchange Commission (SEC). In October, Judge Torres dismissed the SEC’s request to certify its interlocutory appeal. She explicitly stated that Ripple’s defenses, including the argument of “fair notice,” would be reconsidered. While the court did not address the defendants’ fair notice defenses regarding programmatic sales and other distribution, it is possible that these issues will be reviewed if the order is reversed and the case is remanded. The central defense of Ripple is that the regulated entity and individuals involved were unaware that their actions were prohibited. However, the court rejected Ripple’s claims of the SEC’s alleged failure to provide guidance in the context of institutional sales. In contrast, Judge Torres determined that Ripple did not violate securities laws with its programmatic sales to retail exchanges.