February 27, 2020 at 1:10 pm UTC · 2 min read
Over the past few years, a class-action lawsuit has been building against Ripple Labs, the San Francisco-based fintech company that is known in crypto for its involvement in XRP. Unfortunately for the upstart, it was unable to get the case thrown out by the federal judge, potentially threatening its intent to go public through the sale of shares in the near future.
Ripple can’t seem to shake off the XRP class-action lawsuit
According to a report from Bloomberg published on Feb. 26, a federal judge for the Northern District of California has agreed to let a class-action lawsuit, which accuses Ripple of distributing unregistered securities (referencing XRP) by leveraging questionable advertising, against the company proceed.
Notably, it wasn’t all skewed against Ripple; the judge dismissed claims from the class that the fintech startup had made false statements under California law, which lies at the heart of the argument, though the court is giving the plaintiffs another chance to prove wrongdoing in a future complaint.
This ruling comes shortly after the company argued that the lawsuit was untimely because it was filed after the cryptocurrency was purportedly offered to investors years and years ago, as early as 2013, some have said.
May threaten IPO plans, crypto lawyer says
One of the discussions at the heart of this case is whether or not XRP should be treated as a security, commodity (like Bitcoin and Ethereum), or something else entirely.