Pro-XRP Legal Expert Jeremy Hogan Reacts to the Recent Development in the SEC v. Coinbase Lawsuit

Popular pro-XRP legal expert Jeremy Hogan has reacted to the recent development in the SEC v. Coinbase lawsuit, where a federal judge granted the exchange’s interlocutory appeal request.

In a surprising move, District Judge Katherine Polk Failla granted Coinbase the request to pursue an interlocutory appeal in its lawsuit against the SEC. The judge paused the remaining part of the case until the Second Circuit addressed the interlocutory appeal.

Coinbase Chief Legal Officer Paul Grewal, as always, brought the development to the public’s attention in an X post yesterday. Grewal thanked the court for granting the exchange’s motion for leave to pursue an interlocutory appeal.

Over the strenuous objection of @SECGov, Judge Failla has GRANTED our motion for leave to pursue an interlocutory appeal and STAYED the district court litigation.

We appreciate the Court's careful consideration.

On to the Second Circuit we go.

pic.twitter.com/FuZ2jcYvfF

— paulgrewal.eth (@iampaulgrewal) January 7, 2025

Coinbase Latest Decision

The interlocutory appeal, as highlighted by Judge Failla, revolves around the question of whether an investment contract necessitates an actual contract. According to the judge, this issue presents “a controlling question of law” regarding the application of the Howey Test, a well-established security test in the United States, to crypto assets.

Despite criticizing Coinbase for attempting to discredit the SEC’s regulatory approach to crypto assets, the judge nevertheless granted its interlocutory appeal request, which was filed in April 2024.

The judge pointed to conflicting rulings from other federal courts on this matter, emphasizing the need for guidance from a higher court such as the Second Circuit Court of Appeals.

Attorney Hogan’s Reaction

Commenting on the development, Attorney Hogan described the decision as “big news in the legal crypto space.” He added that the issue of whether an investment contract requires an actual contract is also a point of contention in the Ripple appeal, which is set to begin fully later this month.

According to Hogan, it is very rare for a district judge to grant an interlocutory appeal request. He said that the decision suggests that the judge “thinks there is something there.”

This indicates that the judge believes the issue of whether an investment contract requires an actual contract to be immediately reviewed by a higher court.

It can be recalled that a federal judge denied the SEC’s request for an interlocutory appeal in the Ripple lawsuit in October.

What’s Next in the Coinbase Lawsuit

Following Judge Failla’s decision, Coinbase will now file a notice of appeal with the Second Circuit. If the Second Circuit agrees to hear the appeal, Coinbase will submit its appeal brief, arguing why the SEC’s claims of violating federal securities laws are incorrect.

The SEC will then file its opposition, and the Second Circuit will issue its decision. After that, Judge Katherine will resume the lawsuit at the district level.

Meanwhile, the upcoming changes at the SEC could have a significant impact on the outcome of the lawsuit. Notably, crypto skeptic Gary Gensler will be succeeded as SEC chair by Paul Atkins, a pro-crypto advocate.

As a result, both parties may decide to settle the lawsuit and put an end to the legal battle, which started in June 2023.