Ripple files opposition to SEC's proposed $2 billion in fines, calling it 'evidence of its ongoing intimidation'

Ripple Labs filed its rebuttal to the Securities and Exchange Commission's push to have the firm pay close to $2 billion in penalties, in a court document filed late on Monday. 

This comes after the SEC said last month that Ripple should pay close to $2 billion in fines for selling XRP to institutional investors, but Ripple said that figure should be closer to $10 million in its opposition motion. 

"Our opposition to the SEC’s request for $2B in penalties for legacy institutional sales is now public," said Ripple Chief Legal Office Stuart Alderoty in a post on X on Monday. "In a case that had no allegations (or findings) of recklessness or fraud, and in which Ripple won on significant issues, the SEC’s ask is just more evidence of its ongoing intimidation against all of crypto in the U.S." 

"We remain confident that the Judge will approach this final remedies phase fairly," Alderoty added. 

A long road

The SEC and Ripple have been battling in court for years after the SEC accused the firm of raising $1.3 billion through the sale of XRP which it says is an unregistered security. Last year, Judge Analisa Torres of New York ruled that some of Ripple’s sales, called programmatic, of XRP did not violate securities laws because of a blind bid process in place for them. She did, however, rule that other direct sales of the token to institutional investors were securities. 

The SEC said Ripple had made billions of dollars in institutional sales of XRP and argued in its court filing last month that Ripple "still holds the largest amount of XRP by any person and continues to sell it, unregistered, to institutional purchasers." 

Ripple says it has changed the way it sells XRP after last year's court ruling. 

"Ripple has publicly acknowledged that ruling, and does so again now. It has changed the way it sells XRP and changed its contracts to avoid the problems identified by this Court," the firm said in Monday's filing. 

The SEC did not immediately respond to a request for comment. 

Last month, the SEC said it wanted Ripple Labs to pay close to $2 billion, including $876 million in disgorgement, $198 million in prejudgment interest and a civil penalty of $876 million, in its proposed final judgment. The agency asked Judge Torres to weigh the "severity" of the firm's misconduct. 

The SEC fails to show that disgorgement is warranted and also said prejudgment interest should also be thrown out, Ripple argued on Monday. A civil penalty should not exceed $10 million, the firm added. 

"Ripple’s conduct was not egregious," the firm said in its filing. "Its Institutional Sales were made to forty-one 'sophisticated individuals and entities' … over eight years. Those entities were fully informed about the transactions into which they were entering and chose to do so in their own financial interests. There is no allegation that Ripple deceived or misled them."