FameEX Hot Topics | Former SEC Official Foresees Favorable Outcome for SEC in Terra Lawsuit — Anticipates Ongoing Denial of Ripple/XRP Ruling

Former U.S. Securities and Exchange Commission (SEC) official, John Reed Stark, who once headed the SEC's Office of Internet Enforcement, has made some noteworthy predictions regarding ongoing legal battles involving crypto companies. In a detailed post on the social media platform X, Stark, who now serves as the president of cybersecurity firm John Reed Stark Consulting, shared his insights.

Stark expressed his anticipation of a significant victory for the SEC in the lawsuit against Terraform Labs, a crypto-related case. He also expected that District Judge Jed Rakoff, presiding over the Terra lawsuit, would continue to reject the previous ruling by District Judge Analisa Torres in the SEC's lawsuit against Ripple and XRP.

In the SEC's legal battle with Terraform Labs and its co-founder Do Kwon, both parties have submitted dueling summary judgment motions, aiming to secure an early legal victory that would determine whether certain crypto tokens should be classified as securities. Notably, Judge Jed Rakoff, handling the SEC vs. Terraform Labs case, had previously rejected District Judge Analisa Torres' decision in the SEC vs. Ripple Labs Inc. case, stating that he disagreed with her approach. Stark commented on this development, suggesting that Judge Rakoff might diplomatically label Judge Torres' Ripple decision as an anomaly and a mistake.

Stark emphasized Judge Jed Rakoff's significant reputation as a securities law expert, considering him one of the most respected and experienced jurists in this field, not only in the Southern District of New York (SDNY) but possibly in the entire U.S. federal court system. He speculated that Judge Rakoff would likely reaffirm his disagreement with Judge Torres' decision not only during the summary judgment phase but also in future cases involving the application of securities laws to digital assets.