Katz Quoted by The National Law Journal About Crypto Exchange’s Deal With the SEC to Drop Enforcement Action

Manatt Financial Services Partner  was quoted in a National Law Journal article discussing the outcome of Ripple Labs’ deal with the SEC regarding the end of its enforcement action, and what it means for the crypto industry moving forward. 

According to the article, in 2020 the SEC filed action against Ripple for allegedly selling over $1 billion of their cryptocurrency tokens which were unregistered securities. The District Judge held a partial ruling, deciding that Ripple sold unregistered securities to direct buyers but not through secondary markets. After the SEC appealed the decision, Ripple cross-appealed the multi-multimillion dollar fine which led to the SEC chair under the previous administration sending Wells notices and enforcing the fine. When the new presidential administration transitioned in, the SEC ultimately agreed to drop its appeal and enforcement action against Ripple through a deal it had brokered, a significant win for the crypto exchange legal team and the industry according to Katz. 

“Not only has the SEC dropped its appeal of Judge Torres' judgment without conditions, but the Ripple legal team has also successfully renegotiated the penalty piece of that judgment,” Katz said. “It feels like Ripple won its appeal without having to actually litigate it by reducing the fine and getting the SEC to request Torres drop her prior injunction from the initial ruling.” 

Read the full article .