The protracted legal battle between Ripple Labs Inc. and the U.S. Securities and Exchange Commission (SEC) has been shrouded in confusion, complexity, and unpredictability. Jeremy Hogan, a prominent attorney, recently delineated the possible outcomes and timelines for the case, following the judge’s denial of an interlocutory appeal and issuance of a “Summary Judgment.”
According to Hogan, the SEC is now confronted with a multitude of less-than-ideal options, each fraught with its own set of risks and complications.
Option 1: SEC Proceeds with the Trial against Individual Defendants
Hogan allocates a 39.456% chance for this outcome, wherein the SEC moves forward with the trial slated for next April against individual defendants. The judge has left only the most challenging parts of the case for trial, making it a high-risk strategy for the SEC. If the SEC chooses to go to trial, it will also likely expose some of its own internal issues or what Hogan referred to as its “dirty laundry.”
Furthermore, the timeline for an appeal in this scenario extends significantly, potentially stretching as far as 2027 for a final resolution. Given the extended timelines and increased risks, this may not be a palatable option for the SEC.
Option 2: SEC Settles the Case Against Individual Defendants
Hogan provides this option a 32.113% chance of materializing. This path involves the SEC settling the case against individual defendants and then moving to obtain a Final Judgment against Ripple, which it could later appeal. Settling with individual defendants would expedite the case’s journey to an appellate court by 9-12 months and save the SEC from the risk and resource drain associated with a difficult trial. Nonetheless, this route would still involve a protracted “remedies” litigation process, potentially extending the case until August 2026.
Option 3: SEC Settles All Litigation Against Ripple & Individual Defendants
With an 18.98% probability, Hogan suggests that a comprehensive settlement between the SEC and all defendants is also plausible. Such an outcome would allow the SEC to claim a win while also collecting potentially substantial fines from Ripple for the funding of XRP. Despite this, the SEC’s historical reluctance to compromise diminishes the likelihood of this option.
I'm seeing some confusion as to what could happen next in the Ripple v. SEC case now that the Judge denied an interlocutory appeal.
— Jeremy Hogan (@attorneyjeremy1) October 8, 2023
Sooo, I have outlined every possibility and provided the exact chance of each possibility happening and how long each would take. Exactly.
1/356 pic.twitter.com/LfOi2xEsLa
The Unknown Variable
Hogan also concedes the possibility of an unforeseen outcome, attaching an 8.675% chance to this scenario. With the Summary Judgment already setting a precedent, the SEC finds itself in a quagmire, presenting no favourable routes for a quick and decisive victory.
Hogan’s detailed analysis suggests that the SEC is now backed into a corner with no clear pathway to a straightforward win. The options available are less than optimal, involve lengthy timelines, and come with their own sets of risks and drawbacks. The balance of power appears to have shifted, leaving the SEC in an increasingly precarious position. Given these insights, it will be intriguing to see how the SEC navigates these choppy legal waters in the coming years.
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