In a related legal matter, a recent decision made by a US appeals court may bolster Ripple‘s argument in its ongoing lawsuit versus the Securities and Exchange Commission (SEC). Specifically, the SEC was denied by the Second Circuit Court of Appeals the opportunity to file a new motion regarding their earlier loss in the case SEC v. Govil.
In those specific situations where the seller can assume the role of a defendant without having to return any funds, the decision states this is permissible, provided that the buyer did not sustain any financial losses.
Stuart Alderoty, the legal head of Ripple, emphasized that the Securities and Exchange Commission (SEC) cannot request such a substantial penalty for disgorgement without proving that investors suffered any harm.
This week marked another setback for the SEC in the SEC vs Govil case at the 2nd Circuit Court. The ruling established that the SEC cannot demand substantial penalties, known as disgorgement awards, unless they can first prove that investors experienced real financial losses. Simply put, without proven harm, there is no penalty.
— Stuart Alderoty (@s_alderoty) November 3, 2023
An Australian lawyer adds his perspective on the matter, pointing out that investors endured financial setbacks. However, he stresses that Ripple’s advantage in the Govil case hinges on their ability to prove no harm was inflicted upon any institutional investors.
The Securities and Exchange Commission (SEC) intends to impose penalties worth up to $2 billion on Ripple, despite the absence of any accusations of fraud against the company.
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2024-04-12 23:00