Will SEC Face Another Setback in XRP Case?

In a filing made on Wednesday in court, the Securities and Exchange Commission (SEC) has taken a step of appealing the judge’s decision about Ripple’s sales of XRP, using what is called an “interlocutory appeal.” The SEC is asking Judge Analisa Torres, who is overseeing the Ripple lawsuit, to allow a federal appeals court to review her earlier ruling regarding the sales of Ripple’s XRP token. This ruling was previously considered in line with the laws concerning securities.

Reacting to this move by the SEC, former attorney Scott Chamberlain has made a noteworthy prediction. He recently shared on Twitter his speculation that Judge Analisa Torres might reject the SEC’s request for a review in between proceedings. Chamberlain suggests that the judge’s possible refusal could be based on her cautious approach to avoid introducing fresh legal interpretations into the case.

According to Chamberlain, Judge Analisa Torres has consistently refrained from bringing in new legal perspectives. Instead, she determined that the specific token in question does not qualify as a security. She also acknowledged the way the SEC grouped certain transaction patterns for analysis. The judge then directly applied the Howey test, along with its associated principles, to certain transaction categories outlined by the SEC.

The challenges faced by the SEC’s case were not due to any changes made by Judge Torres in the legal criteria for the components of the Howey test. Rather, the challenges arose because the evidence agreed upon failed to meet all the requirements of the Howey test for two out of the three transaction groups selected by the SEC.

Chamberlain made it clear that the main reason for the SEC’s setback was their inability to demonstrate that they met all the essential parts of the Howey test in those specific transaction scenarios. This difficulty did not arise from any alteration in Judge Torres’ understanding of the legal prerequisites for these elements.

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