FOX Business Senior Correspondent Charles Gasparino took to X to reveal that some securities lawyers have highlighted the impact that the Coinbase ruling might have on the ongoing XRP lawsuit.
BREAKING: Securities lawyers say a Fed judge’s ruling against @coinbase should be a warning to $XRP holders that judge Torres’s @Ripple analysis is likely to be reversed by the federal courts. The reason: Judge Failla rejected @coinbase‘s contention that Torres’s @Ripple ruling…
— Charles Gasparino (@CGasparino) March 30, 2024
The Coinbase Ruling Precedent
Earlier in the week, a United States Court rejected Coinbase’s motion to dismiss the Securities and Exchange Commission’s (SEC) lawsuit against the platform. According to Judge Katherine Failla, the Commission has sufficiently pleaded that Coinbase operates as an exchange, broker, and clearing agency under Federal Law.
She went on to highlight Coinbase’s staking program and its alleged sales of unregistered securities as meeting the key concerns addressed by the SEC.
By this decision, the federal Court meant that Coinbase would move to the discovery phase where Coinbase and the SEC would be at liberty to request documents from each other and a final decision would be made on the charges levied against the platform by the SEC.
Consequently, both parties were instructed to submit a case management plan before April 19. From a broader perspective, the expected verdict is likely to take a toll on the XRP lawsuit.
According to some experts, the federal judge’s final ruling against Coinbase should be a warning to XRP holders that the court could still overrule Judge Analisa Torres’ verdict that XRP is not a security. It is worth noting that Judge Failla had earlier rejected Coinbase’s argument that Judge Torres’s Ripple ruling supports its case to dismiss.
Instead, the judge chose to rely on the Terraform analysis of Jed S. Rakoff, a senior United States district judge of the United States District Court for the Southern District of New York. At the time, Judge Rakoff had also rejected Judge Torres’ ruling in the XRP lawsuit. He was clear in his stance that the Torres ruling doesn’t count as precedent in the SEC case against Terraform Labs.
According to Judge Rakoff, the SEC has sufficiently argued it has jurisdiction and “asserted a plausible claim” that TerraUSD (UST), the Anchor Protocol, and LUNA may have violated securities laws.
Ripple Labs May Explore Settlement Path in the XRP Lawsuit
In other words, the outcome of the Coinbase ruling may trigger a revisit to Judge Torres’s July 13 ruling and even give the SEC the backing to file a new appeal should the envisioned complicated twist grow.
Unlike the rejection the regulator suffered last year, this time around, there is a high likelihood that its appeal request would be considered. Drawing on these lost possibilities, the Ripple Labs team may opt for an earlier settlement with the SEC.
There are already ongoing speculations that the second option may be the choice made by Ripple especially after Ripple CEO Brad Garlinghouse and Stuart Alderoty, the company’s CLO were cited outside the courthouse in New York earlier this week to like attend a scheduled “Settlement Conference.”
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Source: https://coingape.com/xrp-lawsuit-can-coinbases-ruling-catalyze-a-reversed-judgement/
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