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Deaton highlighted comments and views shared since the SEC filed the letter of intent to appeal the Judge Torres ruling. Significantly, Deaton expected Judge Torres to grant the SEC motion to file an interlocutory appeal.
Deaton believes that the motion for interlocutory allows Judge Torres to address criticism from Judge Rakoff, the presiding Judge in the SEC v Terraform Labs case.
Regarding the timeline for an appeal, Deaton pointed out that an appeal would take between one to two years. An interlocutory appeal pauses the SEC v Ripple case until the SEC appeal concludes.
Importantly, Deaton stated,
“If the SEC were to win at the second circuit, which I believe they won’t, then the case gets remanded back to Judge Torres, who would apply the facts of the case to the other Howey factors not yet analyzed.”
Deaton explained further, saying,
“In other words, even if the second circuit disagrees with Judge Torres’ analysis of Howey’s third prong, the SEC does not win at summary judgment. Instead, Judge Torres would then apply the investment prong and the common enterprise prong of the Howey test again, further prolonging the case.”
Delay Tactics
It could be a long road ahead for the Ripple team and the crypto market. Deaton believes that Judge Torres would give the same result, even after a successful interlocutory appeal. However, the SEC could ask for a second interlocutory appeal to the second circuit on Torres’ application of the other prongs of the Howey test.
On the flip side, if the SEC loses at the second circuit, the SEC will appeal on all issues after the SEC v Ripple case.
Considering Deaton’s observations, the SEC could push the SEC v Ripple case into 2026 or later. In the September 8 reply memorandum to the Ripple opposition to the interlocutory appeal, the SEC argued,
“The SEC, like the Court, has an institutional interest in the most efficient ultimate resolution of this litigation. Defendants’ interest, by contrast, is to delay an ultimate resolution so that they may continue freely selling XRP into public markets without the disclosures that come with registration […].”
Proper Party Delivers an XRP Boost
While investors await the court ruling on the SEC motion for interlocutory appeal, Ripple held the celebratory Proper Party in New York City.
Ripple CEO Brad Garlinghouse shared images, saying,
“Looking forward to seeing many of you tonight at the Proper Party – excited to bring people together to celebrate what we’ve collectively achieved, a reminder to the SEC that court decisions matter and that progress is worth fighting for.”
XRP Price Action
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