Ripple Labs may be nearing a key procedural moment in its long-standing legal battle with the U.S. Securities and Exchange Commission (SEC). On June 12, both parties filed a second joint motion requesting the court to reduce Ripple’s $125 million penalty and lift the injunction on XRP sales to institutional investors. The motion is currently under review by Judge Analisa Torres, but no timeline has been provided for a decision.

 

Background: From 2020 Allegations to Partial Wins

The SEC first filed a lawsuit against Ripple in December 2020, alleging that the company and its top executives conducted an unregistered securities offering by selling XRP. The case centered on whether XRP constituted a security under U.S. law.

In July 2023, Judge Torres issued a mixed ruling. She concluded that Ripple’s programmatic sales of XRP on exchanges did not violate securities laws, but found that institutional sales did. As a result, Ripple was ordered to pay a $125 million civil penalty and was barred from making institutional sales of XRP.

Ripple later appealed parts of the decision, while the SEC filed its own cross-appeal regarding the programmatic sales ruling.

 

June 12 Motion: What Ripple and the SEC Are Requesting

The second joint motion submitted by Ripple and the SEC is a renewed effort to end the litigation through a modified settlement. Specifically, the motion asks Judge Torres to:

• Reduce the penalty below $125 million
• Lift the sales injunction on institutional XRP offerings
• Allow for the return of remaining escrowed funds to Ripple

The motion also includes a request for an “indicative ruling”, which would allow the appellate court to pause the current appeal if Judge Torres signals she is inclined to modify her previous order.

The parties argue that modifying the judgment would bring finality to the case, conserve judicial resources, and benefit both institutional investors and the public.

 

Legal Opinions Remain Divided

The motion has triggered mixed reactions in the legal community. Attorney Bill Morgan noted that while the second motion is procedurally stronger than the one previously rejected in May, it may still fail to meet the high legal standard for altering a final judgment.

Under Rule 60(b), a court can modify a final judgment only under “exceptional circumstances”. Morgan argued that Ripple’s current motion still doesn’t convincingly demonstrate such circumstances. He also pointed out that Judge Torres took only seven days to dismiss the first motion, suggesting that a quick rejection of this version remains possible.

However, other legal observers are more optimistic. CryptoLaw founder John E. Deaton estimated a 70% likelihood that the motion will be approved, citing the procedural corrections and the mutual interest from both parties in ending the case.

 

June 16 Deadline at the Appeals Court

While Judge Torres has not indicated when or if she will rule on the latest filing, a separate deadline adds pressure to the timeline. By June 16, the SEC is required to submit a status report to the Second Circuit Court of Appeals, detailing whether any progress has been made toward settlement.

If the appellate court finds that a ruling on the settlement motion is likely, it may issue a 60-day stay, temporarily halting the appeal process and giving the district court more time to decide.

If not, Ripple will be required to file its reply brief in the ongoing appeal, which could further extend the litigation into 2026.

 

XRP Price Reacts Cautiously

Ahead of the court update, XRP saw modest gains, rising 1.18% on June 15. While not a dramatic price movement, it suggests some optimism among investors that a favorable decision could arrive in the near future. However, broader market sentiment remains cautious, with most stakeholders waiting for official decisions before making larger moves.

 

What Happens Next?

If Judge Torres grants the motion, the penalty would be reduced, the injunction on institutional XRP sales would be lifted, and the litigation would likely be brought to a close. That could open the door for Ripple to re-engage with institutional partners and potentially pursue long-term plans such as a public offering.

If the motion is denied, however, the legal battle will continue, with both Ripple and the SEC proceeding through the appeals process.

At the time of writing, the court has not provided any indication of when a decision will be made. Until then, both parties, and the broader crypto industry, remain in a holding pattern, awaiting Judge Torres’ next move.