A misconception emerged regarding the recent brief filed by the SEC in the ongoing lawsuit against Ripple Labs. Attorney Jeremy Hogan, a vocal supporter of XRP, has stepped forward to clarify the situation.
SEC’s Response to Ripple’s Penalty Argument
The core of the confusion lies in Ripple’s attempt to leverage the settlement reached between the SEC and TerraForm Labs (TFL) in its defense. Ripple argued that the SEC’s approach to penalties should be consistent. In the TFL case, the penalty amounted to roughly 1.27% of the company’s gross sales. Applying this logic to their case, Ripple proposed a $10 million penalty.
Read Also: Ripple Unlocks 1 Billion XRP From Escrow As Market Value Dips
The SEC, however, disagreed with this interpretation. The regulator argued that a more comprehensive comparison should be made. They proposed that the relevant figures in the TFL case are the combined civil penalty and disgorgement order, totaling $3.58 billion. Using this combined figure, the SEC arrives at a ratio of 11.7% between the penalty and the total amount.
The SEC then applied this 11.7% ratio to the $876.3 million in disgorgement they seek from Ripple. This calculation results in a potential civil penalty of $102.6 million for Ripple, significantly higher than the $10 million proposed by the defendant.
Attorney Hogan Corrects Misconceptions
Following the SEC’s filing, some within the XRP community misinterpreted the regulator’s approach. Misinformation began to circulate, suggesting that the SEC had reduced its overall demand from $2 billion to $102.6 million.
Attorney Hogan addressed this misconception directly. He emphasized that the SEC is not conceding on its overall claim of $2 billion. The $102.6 million figure is solely a response to Ripple’s argument based on the TFL settlement, utilizing a similar logic for comparison.
Hogan also reiterated his previous predictions regarding the lawsuit’s potential outcome. He anticipates the court might impose a $100 million fine on Ripple and a permanent injunction on XRP sales to institutions.
We are on twitter, follow us to connect with us :- @TimesTabloid1
— TimesTabloid (@TimesTabloid1) July 15, 2023
Read Also: XRP Might See 120% Rally in Six Months If This Correction Happens
Similar Sentiment from Legal Experts
Australian lawyer Bill Morgan echoed Attorney Hogan’s analysis. He pointed out that the SEC’s brief has been misinterpreted by some XRP influencers presenting an inaccurate narrative about the agency’s demands.
The XRP community is now focused on the upcoming court decision, which could end this multi-year legal battle at the district court level. It remains to be seen whether either party will take the case to the Second Circuit Court of Appeals.
Follow us on Twitter, Facebook, Telegram, and Google News