These steps were part of the regulator’s efforts to settle its long-standing legal battle with Ripple.
Judge Torres ruled that the parties’ request failed to follow the proper procedure under federal rules.
Torres found this framing inapplicable to the post-judgment context and noted that the parties did not meet the legal standard required to vacate the earlier ruling or reduce the penalty.
The order stated that “their request does not even mention the Rule.” Judge Torres emphasized that Rule 60 requires showing exceptional circumstances, which the parties had not attempted to demonstrate. She added that it would deny the motion even if the jurisdiction were restored.
Ripple’s chief legal officer, Stuart Alderoty, said the court’s ruling does not change the decisions favoring Ripple.
He added:
“This is about procedural concerns with the dismissal of Ripple’s cross-appeal. Ripple and the SEC are fully in agreement to resolve this case and will revisit this issue with the Court, together.”
He added:
“The meaning here is that the parties didn’t request relief under the right rule of civil procedure. So they will refile it under the correct rule but, me reading between the lines, is that Ripple and the SEC need to get on all fours and beg for relief.”
“By styling their motion as one for ‘settlement approval,’ the parties fail to address the heavy burden they must overcome to vacate the injunction and substantially reduce the Civil Penalty.”
He advised that the SEC and Ripple now need to file a detailed motion under Rule 60 for approval, detailing the other cases being dropped with declarations from Commissioners and describing the SEC’s failure to do any meaningful work on crypto guidance.
Rispoli estimated that such a filing would take two to three weeks to prepare, and the court’s decision is expected to take another week or two after submission.
In July 2023, Judge Torres issued a mixed ruling, finding that Ripple’s institutional XRP sales violated federal securities law but programmatic sales on secondary markets did not. The court later issued a final judgment in August 2024, imposing a $125 million civil penalty and enjoining Ripple from further violations.
The May 8 motion intended to facilitate the next procedural step: an indicative ruling from the district court. This ruling would allow the parties to seek a limited remand from the Second Circuit and formally present the proposed relief to Judge Torres.
Instead, the SEC and Ripple must decide whether to revise their motion and proceed through the appropriate channels to finalize a settlement and close the four-year litigation.
