- Ninth Circuit affirms dismissal of class-action securities lawsuit against Ripple.
- Court ruled claims time-barred as XRP public sales began in 2013 with a 2016 deadline.
- Community celebrates legal win while XRP price declined 2% following announcement.
The U.S. Court of Appeals for the Ninth Circuit has upheld the district court’s dismissal of federal securities claims against Ripple Labs, ending a class-action lawsuit alleging the company sold XRP as an unregistered security. The appeals court ruling affirmed that investor claims were filed beyond the statute of limitations deadline.
James Rule posted on X that the decision represents “a major win for Ripple, Brad Garlinghouse, and the XRP ecosystem, adding more regulatory clarity and closing another legal overhang (separate from the ongoing/resolved SEC aspects).” The Ninth Circuit backed the lower court’s determination that investors missed the five-year deadline to bring federal securities claims.
Statute of Limitations Determined Case Outcome
The court ruled claims were time-barred based on when XRP public sales commenced. XRP sales began in 2013, with the three-year statute of limitations expiring around 2016. This timing made the 2019 lawsuit filing too late to proceed under federal securities law.
The appeals court rejected arguments that later activities in 2017 created a “new” security offering. The ruling treated XRP as the same asset throughout all sales periods, preventing plaintiffs from resetting the statute of limitations clock based on subsequent distribution activities.
Diana, an XRP advocate, clarified that the case was not related to the SEC’s lawsuit, stating, “this was NOT the SEC case, it was a separate investor lawsuit, and it’s now permanently closed.” The distinction clarifies that while Ripple resolved its Securities and Exchange Commission enforcement action separately, this class-action litigation represented an independent legal challenge.
James Rule noted the decision “strengthens Ripple’s position, particularly on secondary market sales of XRP not qualifying as unregistered securities offerings.” This precedent could influence how courts evaluate secondary market cryptocurrency transactions in future litigation.
The XRP community responded with mixed reactions as the legal victory did not immediately translate to price gains. Talha Tariq, a crypto trader, posted “Great!! Now waiting for XRP to break it’s all time high,” expressing optimism about future price action.
However, Sid Negri noted market disappointment, stating “Annnnndddddd, it dropped 2%…at this point, only bad news please!” The comment highlighted frustration that positive legal developments failed to generate upward price momentum. Jenny posted simply “didn’t help” in reference to the token’s price performance, while Golden Vibes posted “woot woot,” celebrating the outcome.
Related: XRP Bulls Show Strength Amid Early Signs of a Potential Upside Breakout
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Source: https://coinedition.com/ninth-circuit-affirms-dismissal-of-class-action-securities-lawsuit-against-ripple-labs/
