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Ripple Says XRP Lawsuit Based on 'Unsupported Leaps of Logic'
Ripple has hit back at the lead plaintiff in an ongoing class-action lawsuit that accuses the firm and its CEO of securities fraud.
Updated Sep 14, 2021, 9:38 a.m. Published Jul 31, 2020, 8:43 a.m.
The lead plaintiff in an ongoing class-action lawsuit accusing Ripple of securities fraud has not demonstrated that statements made by CEO Brad Garlinghouse in 2017 are false, Ripple claims in court documents filed Wednesday.
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- The document (see in full below), filed at the Northern California District Court, comes in response to accusations Ripple failed to register XRP as a security with the U.S. Securities and Exchange Commission (SEC) and used deceitful tactics to defraud investors leading to false inflation in XRP's price.
- Ripple's legal team said lead plaintiff Bradley Sostack's allegations relating to Ripple’s purported misrepresentations about XRP were based on "unsupported leaps of logic."
- Sostack has not been able to explain why the alleged statements made by Garlinghouse are false, they claim.
- Ripple's team also took aim at Sostack's "artful pleading," saying he "studiously avoids absolutes" in his allegations.
- The class-action lawsuit was originally filed against Ripple and Garlinghouse in May 2018.
- As one example in the original complaint, plaintiffs allege Garlinghouse had stated on Dec. 14, 2017, he was “very, very long XRP as a percentage of my personal balance sheet.”
- Around the same time, Garlinghouse is claimed to have sold 67 million XRP (worth around $16.4 million at press time). This is a misrepresentation, plaintiffs argue, coming at the time he said he was long on the cryptocurrency.
- Ripple filed a motion to dismiss the suit in part in June, asking the court to dismiss all three counts of fraud without leave to amend.
- A month later, Sostack filed an opposition to the motion, saying the suit had met the demands of U.S. fraud law having identified "over a dozen false or misleading statements made by Ripple and its CEO."
See Ripple's filing in full below:
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