In a notable shift toward final resolution, Ripple Labs and the U.S. Securities and Exchange Commission (SEC) have jointly filed a motion in the U.S. District Court for the Southern District of New York seeking to modify the judgment in their long-standing enforcement matter and release funds held in escrow. Under the proposed stipulation, $125 million in civil penalties previously imposed on Ripple would be partially redistributed—$50 million paid to the SEC, with the remaining $75 million returned to Ripple.
Procedural Background
The joint motion, filed pursuant to Federal Rules of Civil Procedure 60(b)(6) and Rule 62.1, invokes the court's authority to reopen a final judgment in the presence of "extraordinary circumstances." The parties argue that evolving regulatory perspectives—particularly the SEC's shifting enforcement priorities under the current presidential administration—warrant the requested relief.
As of this writing, the funds in question remain held in escrow, secured pending post-judgment proceedings. The joint filing signals a shared interest in avoiding protracted litigation and eliminating what Ripple has consistently characterized as an overbroad and punitive penalty in light of current enforcement posture and the court's earlier factual findings.
SEC Enforcement Climate: A Moving Target
The SEC's approach to digital assets continues to evolve in tandem with shifts in leadership and legislative momentum. While the initial penalty imposed on Ripple reflected the Commission's historically aggressive stance toward unregistered securities offerings in the crypto space, recent signals from the agency—and from courts—have demonstrated a more measured application of enforcement resources.
Critically, this joint motion arrives amid broader discussions about crypto's regulatory classification, the boundaries of the SEC's jurisdiction, and the federal government's evolving role in shaping the digital asset ecosystem.
Legal Framework: Rule 60(b)(6) and Judicial Discretion
Rule 60(b)(6) allows a court to relieve a party from a final judgment for "any other reason that justifies relief," though courts interpret this provision narrowly. Relief under Rule 60(b)(6) is typically reserved for extraordinary circumstances not addressed by more specific provisions of Rule 60. The filing emphasizes that the original judgment was rendered under a markedly different regulatory climate and that continued enforcement of the penalty as originally structured would be inconsistent with current equities.
Nonetheless, courts are often reluctant to revisit final judgments solely due to changes in policy or administration, as such arguments may appear to undermine the finality of litigation and judicial authority. Prior efforts by Ripple to reduce the financial penalties were met with skepticism by the court on this very basis.
Strategic Significance
For Ripple, recouping $75 million would represent both a material financial outcome and a symbolic milestone in its effort to move beyond the shadow of the SEC's multi-year enforcement campaign. For the SEC, accepting a reduced penalty and settling the matter may be a pragmatic step toward reallocating resources in a shifting regulatory environment.
Regardless of the outcome, this motion reflects a maturing dialogue between regulators and major crypto entities, one that may increasingly favor negotiated resolution over full-blown litigation—particularly in legacy enforcement matters that now sit in a different policy context.
Looking Ahead
The court's decision on this motion will be closely watched by stakeholders across the digital asset space. If granted, it may set a precedent for other firms navigating past enforcement actions amid a rapidly changing legal and regulatory landscape. If denied, it will reinforce the judiciary's longstanding caution in reopening final judgments absent truly extraordinary shifts in law or fact.
For now, the motion underscores a growing recognition that legal certainty and regulatory coherence—not just punishment—are vital to the evolution of the digital asset industry.
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