On Thursday, October 20, 2023, the United States Securities and Exchanges Commission (SEC) said it would not pursue Brad Garlighouse and Chris Larsen, the two top Ripple executives.
Brad released a statement following the SEC dropping the charges against him, saying he was the victim of a ruthless target by the regulation agency to ruin him and Ripple.
The letter addressed to Judge Torres reads in part,
“…(“SEC”) respectfully notifies the Court of the stipulated dismissal of the SEC’s pending claims against Defendants Christian Larsen and Bradley Garlinghouse…”
This dismissal may encourage other crypto defendants facing off against the SEC to stiffen their fights against the regulator. Ripple and its executives were awaiting the next trial date set for April 16, 2024.
What does this mean for the Ripple v SEC lawsuit?
Ripple attorney Jeremy Hogan posted a couple of potential outcomes after the Judge issued a “Summary Judgment” and denied an (early) appeal.
- The SEC moves forward with a trial next April against the individual Defendants.
- The SEC could settle the case against the individual Defendants, obtain a Final Judgment against Ripple, and then appeal.
- The SEC settles all litigation against Ripple and the individual Defendants.
Legally speaking, option 2 presented the best outcome for the SEC; coincidentally, the option has come to pass.
Settling out the individual defendants gets the SEC to an appellate court about 9-12 months faster and saves its resources (and face) by bypassing a complicated and overreaching case.
After the settlement of the individuals, the case would go straight to “remedies” litigation. Remedies litigation still would require months and months to complete (which was part of the SEC’s argument as to why it needed an early appeal).
According to Attorney Hogan, this option would still go deep into 2026. August 14, 2026, to be exact.
Now that the executives have gotten off the hook, the SEC can go after Ripple and appeal Judge Torres’s previous ruling.