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Attorney Deaton Predicts Judge Torres’ Rejection of SEC Appeal Request

Yuri Molchan
Last updated: | 2 min read
Linqto Youtube Channel

Speculations and discussions around the Ripple versus SEC lawsuit continue even after the fintech company secured a victory in recently-released summary judgment. 

Recent tweets capture a correspondence between CryptoLaw founder John Deaton, Attorney Bill Morgan, and former SEC regional director Marc Fagel concerning the possibility of an appeal on the case.

In a July 16 tweet, Deaton speculated that US District Judge Torres would not approve an appeal request from the SEC. 

Deaton and Others Argue Whether Judge Torres Would Decline SEC’s Appellate

A statement from an XRP enthusiast claiming that Deaton said none of the parties could appeal the judge’s ruling until the final court resolution triggered an exchange between the trio. 

However, reacting to Deaton’s statement, Fagel said that while it is up to the court to approve an appellate, either party can seek an immediate appeal.

In response to Fagel, Deaton clarified his statement, noting that he never implied an appeal can’t come before a jury verdict. He added that while both parties have the right to appeal, it won’t be immediate. 

Furthermore, the prominent pro-XRP lawyer explained that either party could ask Judge Torres to approve their appeal request before asking the second circuit to accept it. 

However, Deaton emphasized that he doesn’t think Judge Torres would approve the SEC’s request.

Deaton believes the judge would decline it because she based her ruling on a strict application of the Howey factors per the SEC’s summary judgment request. 

According to the lawyer, Judge Torres applied the Howey analysis to each XRP sale which the SEC alleged violated securities law.

“The court agreed that the Howey test was controlling and applied it accordingly. In essence, the judge applied a non-controversial 76-year-old well-settled Supreme Court test to the facts of the case,” Deaton explained

On that note, Deaton concluded that either party may submit a written application to persuade the judge, but he sees no point in trying. 

Will Ripple Appeal Judge Torres’ Decision? Fagel and Deaton Exchange Views

In addition, Attorney Deaton said he would be surprised if Ripple agreed to an interlocutory appeal to cross-appeal on the ODL sales. He expects the fintech company to counter any motion to appeal Judge Torres’ decision. 

In response, Fagel stated that both sides would appeal Judge Torres’ ruling, adding that the SEC had a better chance of reversing the judgment on the “programmatic sales.”

The exchange dragged on, with other XRP enthusiasts chipping in. Weighing in on the discussion, Bill Morgan supported Marc Fagel’s opinion. 

Morgan said he agreed with Fagel that both sides would appeal, noting that the only thing preventing it would be a settlement. However, the former SEC director speculated there wouldn’t be a settlement. 

According to Fagel, the SEC won’t accept a settlement because it won’t take the ruling off the books. Also, Judge Torres’ decision significantly affects the SEC’s cases against crypto exchanges in other courts.