Ripple is no stranger to lawsuits and the court. For years, the company has been under scrutiny from the public and mainly burnt out investors. The main accusation was that Ripple was selling XRP without correctly registering it as a security with the SEC; an ongoing lawsuit.
Brad “very, very long XRP”
In 2017, Brad Garlinghouse, the CEO of Ripple stated that he was “very very long XRP” as a percentage of his balance sheet and this statement has backfired. Bradley Sostack came forward with evidence that Brad Garlinghouse, at the time of that statement, had sold 67 million XRP.
The plaintiffs stated that while the CEO was making that statement publicly, he: “Rather was dumping XRP on retail investors in exchange for dollars and other cryptocurrencies. 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.” This statement was followed by the explanation that Brad Garlinghouse was misleading investors about the actual utility of XRP, stating one thing in public while doing another.
According to the court filing obtained by Law360, Ripple, in response to the accusations, decided to attack the logic rather than legitimacy of the claims by saying they were “unsupported leaps of logic”. Ripple also claimed that the plaintiffs were unable to prove that the statement about XRP’s utility were false when stating “XRP had no utility at all”.