Legal Expert Says Judge Torres Will Deny SEC’s Appeal Request

Prominent legal expert Scott Chamberlain makes a bold prediction, stating that Judge Analisa Torres will deny the SEC’s interlocutory appeal request.

In the wake of the SEC requesting to file an interlocutory appeal in the Ripple lawsuit, former lawyer Scott Chamberlain has made an audacious prediction regarding the request.

In a tweet today, Chamberlain speculated that Judge Analisa Torres would deny the SEC’s interlocutory appeal request. According to Chamberlain, the judge will deny the request because “she studiously avoided new law.”

Chamberlain Highlights How SEC Lost

Chamberlain went further and highlighted Judge Torres’ decision and how the SEC lost the case. The legal expert noted that the judge found that XRP itself is not a security.

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He added that she accepted the SEC’s characterization of Ripple’s sales and distribution of XRP and applied the Howey test and its progeny to each of them.

“She found the token is not the security, accepted the SEC’s characterization of the transaction ‘buckets’ to be analyzed, and simply applied Howey and its progeny to the SEC’s chosen buckets,” said Chamberlain.

My bet: Judge Torres denies the request. She studiously avoided new law.

She found the token is not the security, accepted the SEC’s characterisation of the transaction “buckets” to be analysed, and simply applied Howey and its progeny to the SEC’s chosen buckets.

SEC failed… https://t.co/o9MZk8Q7gP

— Scott Chamberlain | 🏴‍☠️ 🪝 (@scotty2ten) August 10, 2023

The former lawyer clarified that the SEC lost two out of its three transaction buckets because they did not satisfy all the prongs of Howey. He added that the SEC’s loss in the lawsuit had nothing to do with the judge “shifting the legal goalposts on the definition of those prongs.”

Attorney Morgan Agrees With Chamberlain

Chamberlain’s comment stirred reactions from top XRP enthusiasts, including Attorney Bill Morgan. Reacting to the tweet, Attorney Morgan commended Chamberlain’s analysis, saying he “completely agrees” with it.

Good points Scott. Completely agree.

— bill morgan (@Belisarius2020) August 10, 2023

Exchanges Won’t Delist XRP

Meanwhile, the SEC’s interlocutory appeal request has been a major topic of discussion within the XRP community. The development has raised concerns among enthusiasts.

Some community members speculate that a victory for the SEC on programmatic sales could prompt exchanges to delist the coin. However, Attorney Jeremy Hogan does not think exchanges will delist the coin, irrespective of the outcome.

Deaton Explains How Court Will Issue Same Verdict 

Notably, the SEC only seeks Judge Torres’s permission to file an interlocutory appeal. It remains to be seen whether the US district judge will approve the request.

As reported earlier, Attorney Deaton speculated that it would take at least two years for the Second Circuit to issue a decision on the matter if the SEC successfully appealed the ruling.

Per Deaton, if the Second Circuit decides that Judge Torres’ erred in her application of the third prong of Howey to Ripple’s programmatic sales and other distribution, it would remand the case.

Consequently, Judge Torres will have to apply Howey’s first (investment of money) and second (common enterprise) prongs to the transactions to determine whether they qualify as investment contracts. Deaton speculated that Judge Torres would still issue a similar verdict because the SEC failed to satisfy the second prong.