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Ripple CEO's Public Statements About XRP Token Under Fire in Class-Action Lawsuit

Ripple CEO’s Public Statements About XRP Token Under Fire in Class-Action Lawsuit


Plaintiffs in the class action lawsuit against Ripple Labs have filed another litigation complaint against Ripple CEO Brad Garlinghouse. The news follows the recent court judgment that denied Ripple Lab’s attempt to get the case dismissed.

Also read: Market Update: Slew of Unknown Coins Has Seen Considerable Gains Since ‘Black Thursday’

Plaintiffs Accuse Ripple Labs CEO of Selling XRP After Telling the Public He Was ‘Long XRP

On March 25, the plaintiffs suing Ripple Labs filed an amended complaint with the court against the company’s CEO Brad Garlinghouse. According to the court filing, Garlinghouse told the public a few statements during interviews and on Twitter that ostensibly favor the plaintiff’s side of the argument. The document notes that the CEO told people on Twitter and in the media that he was holding and “long XRP,” but the plaintiffs believe Garlinghouse was selling the token regularly. The complaint filed on Wednesday reads:

Ripple’s CEO, Brad Garlinghouse, has also been a vocal advocate for investing in XRP. In a December 14, 2017 interview with BNN, when asked if he is personally invested in XRP, the CEO stated ‘I’m long XRP, I’m very, very long XRP as a percentage of my personal balance sheet.

Ripple CEO's Public Statements About XRP Token Under Fire in Class-Action Lawsuit

However, despite Garlinghouse explicitly saying that in public, the plaintiffs believe the CEO was instead dumping lots of XRP on the open market for USD and other assets. They believe retail investors were damaged by these alleged actions and Ripple Labs employees had knowledge of these instances, the plaintiffs further claimed.

“Rather,[Garlinghouse] was dumping XRP on retail investors in exchange for dollars and other cryptocurrencies,” the complaint adds. “Defendants had exclusive or superior knowledge of material information regarding Garlinghouse’s XRP sales but omitted it from their representations to investors…Accordingly, Garlinghouse’s statement was a misrepresentation and omission of material fact to investors.”

Ripple CEO's Public Statements About XRP Token Under Fire in Class-Action Lawsuit

Lawsuit Claims XRP Is Centralized and a Security

Essentially, the plaintiffs suing Ripple Labs also believe that the firm advertised XRP as a utility token for the network but the company is accused of simply using XRP for revenue. Other than making revenue, the plaintiffs say that XRP is basically a security token and other products like Ripplenet and Xvia are simply smoke and mirrors with no real value. Ripple Labs and Garlinghouse have denied all of these accusations against them and have tried to get the case dismissed. In addition to the plaintiff’s attempt to get a jury trial, the case questions whether or not XRP is a security. The plaintiffs wholeheartedly believe that XRP is a security and the entire project is centralized.

Ripple CEO's Public Statements About XRP Token Under Fire in Class-Action Lawsuit

For instance, the plaintiffs further highlight that the Ripple Labs XRP product manager, Warren Paul Anderson, tweeted frequently about XRP’s centralization issues. “On January 9, 2018, Anderson tacitly admits that the XRP Ledger remains centralized, tweeting that the ‘[N]ew XRP Ledger (rippled) 0.81.0 release gets us one step closer to executing on our aforementioned decentralization strategy,’” the complaint notes.

What do you think about the class-action lawsuit against Ripple Labs? Let us know in the comments below.

 

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Tags in this story
Brad Garlinghouse, Centralized, Class Action Lawsuit, Class-Action, court case, Cryptocurrency, defendants, Digital Assets, plaintiffs, retail investors, Ripple, Ripple CEO, Ripplenet, Security, Vaporware, Warren Paul Anderson, XRP, XRP Army, Xvia

Image Credits: Shutterstock, Pixabay, Wiki Commons, Pacer

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