Ripple’s ongoing legal battle with the U.S. Securities and Exchange Commission (SEC) has hit another snag after a federal judge dismissed the parties’ joint settlement request due to a procedural misstep. The motion, which was aimed at finalizing the terms of a settlement between Ripple and the SEC, was rejected by Judge Analisa Torres of the U.S. District Court for the Southern District of New York on May 15, 2025.
Attorney James Filan first shared the ruling on X (formerly Twitter), alongside the court documents, noting that the judge had denied the request for an “indicative ruling.” The motion, filed on May 8, sought to reduce a $125 million civil penalty to $50 million and lift certain restrictions imposed by the court. However, Judge Torres deemed the filing “procedurally improper,” citing that the motion was not submitted under Rule 60, which requires a showing of “exceptional circumstances” for modifications to a final ruling.
The rejection puts a halt to Ripple’s hopes of finalizing the settlement agreement during ongoing appeals, forcing both Ripple and the SEC to explore other options to resolve the case.
Ripple’s Chief Legal Officer, Stuart Alderoty, quickly responded to the news, assuring the crypto community that the court’s decision did not alter the company’s significant legal victories. “This is about procedural concerns with the dismissal of Ripple’s cross-appeal,” Alderoty clarified on X, emphasizing that the substance of the legal wins, including the 2023 ruling that XRP is not a security in programmatic sales, remains unchanged.
The procedural issue highlights the complexities of the case, and according to attorney Fred Rispoli, both sides now face the difficult task of requesting relief through the proper legal channels. “Now, they’ll have to do it the hard, messy way,” Rispoli remarked, referring to the need for a formal motion under Rule 60.
The legal proceedings date back to 2020 when the SEC filed a lawsuit against Ripple, accusing the company of selling XRP as an unregistered security. The court has since issued mixed rulings, with a 2023 decision determining that institutional sales of XRP qualify as securities, while retail sales were exempted from security laws.
The court’s latest decision has caused a significant reaction in the market, with XRP’s price dropping approximately 7% in the past 24 hours. The uncertainty surrounding the case also led to a 9.4% drop in open interest, bringing it down to $4.93 billion. Traders have reacted with caution, resulting in over $21 million in long positions being liquidated. XRP is now retesting a support level at $2.36, and investors are closely watching its next move.
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