TL;DR

Ripple was ordered to pay a $125 million fine, significantly lower than the US SECs initial demand, with both parties able to contend until early October. Lawyer Bill Morgan now sees a reduced chance (45%-55%) of an appeal form the Commision, based on recent case developments and favorable views on Judge Torres ruling.

The Appeal Seems Less Likely?

The latest major development surrounding the lawsuit between Ripple and the US Securities and Exchange Commission (SEC) occurred at the beginning of August when Judge Torres ruled that the company must pay a $125 million fine for violating certain securities laws. 

Numerous industry participants interpreted the decision as a major win for the firm, considering that the regulator initially insisted on a $2 billion penalty. Some even labeled it the end of the legal battle.

However, the case remains ongoing since both entities have until early October to appeal. Such a move coming from Ripple would be viewed as a surprise since the fine represents a 94% deduction on the regulators demand. Moreover, CEO Brad Garlinghouse said the firm respects the courts ruling, while CLO Stuart Alderoty stated the organization will pay the $125 million penalty in cash off its balance sheet. 

One person who initially thought there was an 80% chance of appeal coming from the SEC is the pro-XRP lawyer Bill Morgan. Recently, though, he lowered the figure to 45%-55% after observing the developments in other cases involving the watchdog and the crypto industry. 

For instance, Judge Orrick (overseeing the lawsuit between Kraken and the SEC) preferred the approach of Judge Jackson (in the Binance case) and Judge Torres rather than Judge Rakoff (in the Terraform case).

The favorable comments about aspects of Judge Torres reasoning in the Ripple summary judgment decision by Judges Orrick (Kraken case) and Jackson (Binance case) should assuage doubts about the correctness of her decision raised by some critics such as Gasparino, Morgan maintained.

Earlier this year, Charles Gasparino, Senior Correspondent at FOX Business, claimed there were signs that Judge Torres legal analysis on the Ripple v. the SEC case might be faulty.

Morgan outlined that Judge Orrick praised Torres decision as carefully constrained to the facts of the case and predicated on findings from a fully developed record. 

Last but not least, Morgan said the SEC can easily distinguish the Ripple case from the other lawsuits because it is narrowly confined to its own facts. 

Why appeal it at all, unless, of course, there are nonlegal considerations influencing the decision to appeal, he concluded.

What if There Is an Appeal?

One individual who believes the SEC could have the upper hand should the case reach the Court of Appeal is Dennis Kelleher (former Senior Senate Staffer). 

Chance of the US SEC winning on appeal 90%: the Ripple judge got 90 years of law upside down when he ruled sophisticated investors get the protection of the securities laws, not unsophisticated investors. Thats why all the other judges have rejected it, he said in mid-August.

On the other hand, Ripples top lawyer, Alderoty, estimated that the agencys chances of securing a decisive victory are quite slim, arguing that the aforementioned court reverses the initial rulings in less than 10% of the cases.