Ripple has had a tough time in the US, having been taken on by the SEC in regards to securities laws violations. Now, however, attorneys from Bitcoin Manipulation Abatement LLC have filed a lawsuit against them, as well. According to this filing made in the US federal district court, Ripple is claimed to have intentionally misled investors, selling XRP as an unregistered security. This, as one would imagine, stands in violation of federal law.
Vague Company Taking On Ripple
The court documents, filed on the 1st of May, has the company, with little online presence before this, accusing Brad Garlinghouse, the CEO of Ripple, as well as Ripple itself. The accusation is that they had raised more than a billion in USD via marketing and selling XRP as an unregistered security.
The filing states that both Defendants had made a “litany” of misleading and false statements when it comes to XRP as a whole. The alleged goal for doing so is to drive the demand, therefore increasing the profits of the sale of XRP as a whole. As one would imagine, this sort of act stands in clear violation of the false advertising and unfair competition laws, as well as California’s securities laws.
Bitcoin Manipulation Abatement LLC is seeking to “recover damages” as well as obtaining “other relief” in regard to these alleged violations.
It should be noted that it was this very same firm that filed a $150 million lawsuit against the FTX derivatives exchange. This occurred back in November of 2019, and was subsequently dismissed by the court just a month later. The entire fiasco was so noteworthy that crucial figures within the crypto community at large gave a comment about this. CZ was one of them. The CEO of Binance voiced his opinion that the lawsuit in question was far fetched, indeed.
Ripples Colourful History
The Ripple firm itself has had its fair share of legal action throughout its life, both long and short term, when it comes to its XRP token. XRP stands as one of the most valuable cryptocurrencies by market cap, and a class-action lawsuit was leveled against it all the way back in May of 2018. This lawsuit has been going forward thanks to the efforts of one Bradley Sostack and his attorneys. Sostack accuses Ripple of similar charges of securities laws violations and investor deception.
Sostack sought damages as well as legal cost compensation, sure, but the investor made it clear that his goal was the recognition that XRP is a security, as well. However, with the amendment that was filed on the 25th of March, it shows that Sostack isn’t taking any risks and is hedging his bets.