Lawyers representing the United States Securities and Exchange Commission (SEC) announced that they shall dismiss all claims against Brad Garlinghouse, the CEO of Ripple, and Chris Larsen, the executive chair of the company.

The SEC informed the court that the parties in its case against Ripple "have stipulated to the dismissal with prejudice" in a document filed on October 19 in U.S. District Court for the Southern District of New York, indicating that there was no need to set a trial date in the near future.

The SEC's civil lawsuit against Ripple itself, first brought in 2020, was not mentioned in the filing.

The filing stated:

“The SEC and Ripple intend to meet and confer on a potential briefing schedule with respect to the pending issue in the case—what remedies are proper against Ripple for its Section 5 violations with respect to its Institutional Sales of XRP—and respectfully request until November 9, 2023 to propose such schedule to the Court or, if the parties cannot agree, to seek a briefing schedule from the Court on a contested basis."

In response to the filing, Ripple chief legal officer Stuart Aldeorty called the move “a surrender by the SEC” rather than a settlement, and Ripple publicized a statement which characterizes the SEC's decision as a “stunning capitulation”.

“Chris and I [...] were targeted by the SEC in a ruthless attempt to personally ruin us and the company so many have worked hard to build for over a decade,” stated Garlinghouse in a X (formerly Twitter) post.

The SEC's actions on Ripple started in December 2020 when it filed a lawsuit against Garlinghouse, Larsen, and the business, primarily over the sale of its XRP tokens, which the commission also asserted were securities.

A federal judge decided in July that when sold to retail investors, XRP was not a security.

After nearly three years and with a trial set to start in April 2024, it is unclear why the SEC decided to drop the charges.

Cboe Digital's chief legal officer, Katherine Kirkpatrick, hypothesized that dismissing the case against Garlinghouse and Larsen might indicate the SEC intends to appeal the court's ruling on XRP as a security — something she said would have to wait until the trial was over.

Sources:

https://cointelegraph.com/news/sec-dismiss-lawsuit-brad-garlinghouse-chris-larsen

https://twitter.com/s_alderoty/status/1715107927428837875

https://www.businesswire.com/news/home/20231019165876/en/In-Landmark-SEC-Surrender-Ripple-CEO-Brad-Garlinghouse-and-Executive-Chairman-Chris-Larsen-Are-Cleared-Of-All-Baseless-Allegations

https://twitter.com/bgarlinghouse/status/1715108497107694019

https://twitter.com/kkirkbos/status/1715113666540945783