The lawsuit against Ripple that was filed back in May was finally dropped by the US Northern District of California court.
Lawsuit Against Ripple Denied
Ripple Labs Inc. has been a subject of multiple controversies, especially when it comes to its cryptocurrency, also called Ripple. The coin has been accused of centralization, and the company even received a lawsuit that stated that they used illegal and dishonest tactics to trick the investors and control the coin’s price.
While many who support and make these claims have stopped at bashing Ripple on social networks, there were also those who took action against the company. Back in May of this year, an XRP investor by the name of Ryan Coffey filed a lawsuit against Ripple after suffering losses instead of gains on his investment. Coffey led an entire group of displeased investors and has filed a lawsuit against Ripple Labs on May 3rd of this year.
He issued ‘Order Denying Motion to Remand’, which ensured that the case would remain in the lower courts of California, instead of advancing to Federal levels. Due to an apparently bad investment, Coffey suffered losses when Ripple price went down. After that, he demanded compensation for his financial loss, and when he did not receive it, he accused Ripple Labs of manipulating the price of XRP in order to make profits and damage its investors.
According to him, Ripple promoted its crypto through the media, while at the same time, it used the media to make prices go up or down. Simultaneously, he accused XRP of being a security, and Ripple Labs of ignoring the California Corporations Code regarding the securities laws.
Additionally, the lawsuit also accused Brad Garlinghouse, Ripple’s CEO, directly. Garlinghouse was accused of misleading investors and falsely explaining how the products of the company are being used. Coffey finally accused the XRP of not being decentralized and violating federal laws regarding securities.
Ripple Still Not in the Clear
After several months, the lawsuit against Ripple was finally denied by the court that released the following statement:
Having read the papers filed by the parties and carefully considered their arguments and the relevant legal authority, and good cause appearing, the court hereby DENIES plaintiff’s motion.
While this is generally a good news for Ripple, the company is still not in the clear. Two other lawsuits were filed against Ripple, but these two were brought to the attention of a federal court. As for Coffey and his legal representatives, the Rosen Law Firm, it is possible that they wanted to avoid the federal court on purpose.
According to some theories, this decision might have come as a method of preventing Ripple from benefiting in case of its victory in court. If Ripple was to win in a federal court, the company and its coin would have received a lot more positive attention.