Dismissal of SEC lawsuit against Ripple executives
The U.S. Securities and Exchange Commission (SEC) dismissed its action against Chris Larsen, a co-founder of Ripple, and Brad Garlinghouse, the company's CEO. The lawyers representing the SEC, Ripple, Garlinghouse, and Larsen wrote in a document filed with the U.S. District Court for the Southern District of New York:
The claims made by the Securities and Exchange Commission against defendants Bradley Garlinghouse and Christian A. Larsen are now hereby conceded and agreed to be fully dismissed without prejudice, costs to either party, or costs to the plaintiff or defendant.
According to the complaint, the two executives were accused by the securities commission of "aiding and abetting Defendant Ripple Labs Inc.'s violations... with relation to Ripple's offers and sales of XRP in "Institutional Sales."
The SEC informed the court of the negotiated dismissal of its pending allegations against Garlinghouse and Larsen in a letter to District Judge Analisa Torres on Thursday. SEC declared:
The October 2, 2023 scheduling order is rendered moot as a result of this voluntary dismissal, which eliminates the need for the planned trial on this claim.
"The SEC and Ripple intend to meet and confer on a potential briefing schedule with respect to the pending issue in the case—what remedies are proper against Ripple for its Section 5 violations with respect to its institutional sales of XRP," the letter reads. The SEC asked the court to give them until November 9 "to propose such schedule to this court or, if the parties cannot agree, to seek a briefing schedule from the court on a contested basis."
Judge Torres denied the securities regulator's request to appeal her decision regarding XRP at the beginning of this month. Gary Gensler, the chairman of the SEC, stated in July that the agency is "disappointed" with the XRP decision regarding retail investors.
On social media platform X, Ripple CEO Brad Garlinghouse stated: "In all seriousness, Chris and I (in a case involving no claims of fraud or misrepresentations) were targeted by the SEC in a ruthless attempt to personally ruin us and the company so many have worked hard to build for over a decade." The chief executive said, "The SEC continuously failed to protect US customers & businesses while secretly meeting with people like SBF [Sam Bankman-Fried, former CEO of the defunct crypto exchange FTX]. How much money, in the millions, did the taxpayers lose? Being finally justified feels fantastic.
Stuart Alderoty, the chief legal officer of Ripple, stated on X:
The SEC committed a grave error by targeting Brad & Chris personally, and they have finally given up, dropping all charges against our leadership. No resolution has been reached. The SEC has given up control of this.
He explained, "That's 3 wins in a row for Ripple, including the July 13 decision stating that XRP is NOT a security as a matter of law, the Oct. 3 decision dismissing the SEC's attempt for an interlocutory appeal, and now this.
After the SEC's lawsuit against Ripple executives was dismissed, XRP gained roughly 6%, before experiencing a slight reversal. The price of XRP is approximately $0.51 at the time of writing.
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