The U.S. Securities and Exchange Commission (SEC) is facing criticism for dropping lawsuits against major crypto firms, including Ripple. Following a letter from House Democrats, questions have emerged about whether the SEC can reopen the Ripple lawsuit. However, legal experts argue that such a move is not legally possible.
The crypto industry is discussing the possibility of the SEC reopening its lawsuit against Ripple. This followed a letter sent by House Democrats to SEC Chair Paul Atkins. The letter accused the SEC of dropping key enforcement actions, including Ripple’s case.
Crypto lawyer Bill Morgan addressed these speculations. He explained that the SEC is legally blocked from reopening the case. Morgan pointed to the legal rule known as “Res Judicata.” This rule prevents the same case from being litigated again once it is resolved by a court.
Morgan said, “Too bad the SEC can’t go against those companies again on the same matters. Res Judicata baby.”
This statement refers to the finality of court decisions. Once a judgment has been made, it cannot be challenged again in court on the same issue by the same parties.
The SEC filed a lawsuit against Ripple Labs on December 22, 2020. At the time, the agency claimed Ripple’s XRP token was an unregistered security. This case started under former SEC Chair Jay Clayton’s leadership.
Ripple spent over five years fighting the charges. In June 2023, Judge Analisa Torres made a key ruling that marked a turning point. However, the legal process extended into 2025 before concluding.
The court sided with Ripple, stating that XRP sales on exchanges did not qualify as securities. Ripple’s legal team worked to prove that the company did not violate U.S. securities laws. Since the court made its ruling, the case is considered legally closed.
The House Financial Services Committee Democrats questioned the SEC’s decision to drop twelve crypto-related lawsuits. These included cases against Kraken, Binance, Coinbase, Robinhood, and Crypto.com.
The lawmakers alleged that each company made political contributions of at least $1 million. They implied that these donations may have influenced the SEC’s decisions.
Despite these claims, no evidence has confirmed that donations affected case outcomes. Bill Morgan clarified that political pressure cannot override court rulings. Once a final judgment is entered, the law does not allow for retrials on the same issue.
With the lawsuit over, Ripple has shifted its focus back to growing its business. The company continues to develop its payment technologies and expand its partnerships. XRP also remains a key digital asset in the crypto space.
The end of the lawsuit has allowed Ripple to move forward without the regulatory uncertainty it faced during the legal battle. Other companies once involved in similar lawsuits have also resumed operations under clearer legal conditions.
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