The block reported that Ripple Labs, embroiled in a long-standing legal battle with the U.S. Securities and Exchange Commission (SEC), strongly opposed the SEC’s request for a $2 billion fine in court documents filed on Thursday. The company cited the judgment result of the Terraform settlement on Wednesday, arguing that a fine of no more than $10 million would be more reasonable.
According to a “notice of supplemental authority” submitted by Ripple Labs yesterday, the company compared the SEC’s proposed $20 billion fine with the $45 billion fine imposed on Terraform Labs and raised objections.
In the Terraform case, the SEC’s request for and final civil fine indicated that the SEC’s proposed civil penalties against Ripple were quite unreasonable. Even though Terraform Labs and its CEO Do Kwon caused global investors to lose over $40 billion, they only faced a civil fine of around $45 billion.
Previously, Terraform and Do Kwon’s lawyers also negotiated the SEC’s claimed $53 billion civil fine, suggesting a maximum fine of $1 million.
Ripple’s lawyers stated that in similar cases, SEC fines typically range from 0.6% to 1.8% of the defendant’s total revenue. Considering Ripple’s $1.3 billion in revenue from selling XRP, they suggested a more reasonable fine of up to $10 million for Ripple.
The lawyer also mentioned that Terraform and its founder Do Kwon were accused of civil fraud, while Ripple had no fraud-related charges, and institutional investors did not suffer any losses as a result. Therefore, the court should reject the SEC’s disproportionate and unfounded requests.
Legal expert Bill Morgan agreed, stating that the SEC’s penalty request was untenable. With the litigation between SEC and Ripple entering its fourth year, the SEC submitted its final defense in the lawsuit last month, potentially setting a precedent for the treatment of cryptocurrencies under U.S. securities law in September.
Despite years of litigation, Ripple continues to develop new products and expand its business, including acquiring digital asset custodian Standard Custody and launching the new stablecoin $RLUSD.
Do Kwon
Ripple
SEC
Terraform Labs
civil fine