Judge Torres Rejects Ripple–SEC Deal: No Early Exit, $125M Penalty Still Stands
- Mathew Jacob
- Jun 26
- 2 min read
In a dramatic twist in the ongoing legal saga between Ripple Labs and the U.S. Securities and Exchange Commission (SEC), Judge Analisa Torres has firmly denied the joint request from both parties to end the case early. The motion, filed in an unusual display of unity between the longtime adversaries, aimed to terminate the case and resolve financial penalties by releasing $125 million currently held in escrow. However, the judge ruled that the motion was procedurally flawed and lacked the “exceptional circumstances” required to justify such a dramatic reversal under federal law.
The motion had proposed that $50 million of the escrowed funds be handed to the SEC, while the remaining $75 million would return to Ripple. In addition to the fund allocation, both parties had also asked the court to dissolve the permanent injunction that bars Ripple from making institutional XRP sales in the U.S., a restriction that has weighed heavily on the company since the ruling last year. However, Judge Torres made it clear that the filing failed to meet the legal threshold necessary for the court to reconsider its earlier decision. She emphasized that the motion, while jointly filed, was improperly styled and did not align with the requirements of Rule 60(b), which governs relief from a final judgment or order. Simply put, the court saw no compelling reason to reopen or revise the August 2024 judgment that imposed both the penalty and the injunction.
By rejecting the motion, the court has kept Ripple’s $125 million civil penalty intact and left the permanent injunction fully in place. This decision adds another layer of complexity to a case that has already reshaped how digital assets are viewed by regulators and market participants alike. While the XRP community had hoped this joint effort marked the beginning of the end for the legal battle, the denial indicates that neither party will be granted a shortcut to closure.
Ripple’s Chief Legal Officer, Stuart Alderoty, has reiterated that the company's key victories—especially the court’s earlier decision that secondary XRP sales did not constitute securities transactions—remain untouched. However, the company must now return to the drawing board if it hopes to resolve the remaining penalties or limitations. For the SEC, this rejection could serve as a sobering reminder that even partial settlements or jointly proposed motions must adhere strictly to procedural standards.
With this latest decision, the path ahead remains uncertain. Any revised settlement proposal must now convincingly demonstrate why such a shift is warranted under the high bar of “exceptional circumstances.” Without that, the legal standoff may extend well into late 2025 or even 2026. Despite the setback, many in the crypto industry are watching closely, hopeful that a definitive outcome—win or lose—will finally provide regulatory clarity for Ripple and the broader blockchain ecosystem.
