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ARTICLE · 15 MARCH 2021

SEC V. Ripple

Cooley LLP
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On December 22, 2020, the Securities and Exchange Commission filed a complaint in the Southern District of New York (SDNY) against Ripple Labs, Inc.

United StatesCorporate/Commercial Law
Cooley LLP
Cooley LLP
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On December 22, 2020, the Securities and Exchange Commission filed a complaint in the Southern District of New York (SDNY) against Ripple Labs, Inc., and Ripple executives Bradley Garlinghouse and Christian A. Larsen in their individual capacities.1

The complaint alleges that (i) the defendants engaged in unregistered sales of securities in violation of Sections 5(a) and 5(c) of the Securities Act of 1933 through repeated sales of the XRP token dating back as far as 2013, and (ii) Larsen and Garlinghouse aided and abetted Ripple's unregistered sales of securities, dating as far back as 2013 and 2015 respectively, by taking actions such as deciding when and how much XRP Ripple would sell, establishing an escrow account holding most of Ripple's XRP to assuage investor concerns about sales,2 making promotional statements about XRP and taking other actions intended to increase demand from XRP. The SEC did not allege that any fraud on investors occurred, but detailed

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