Another lawsuit was filed against the Ripple. The main plaintiff David Oconer demands to recognize the XRP cryptocurrency as a security. This is reported by CCN.
The claim was filed in California, and Ripple Labs, CEO of Brad Garlinghouse and its financial services division, XRP II LLC, were named as defendants.
According to the lawsuit, the way Ripple Labs manages and distributes its cryptocurrency testifies that XRP is a security. Consequently, by selling it, the company violates securities laws, Oconer says.
He also notes that Ripple Labs is promoting its cryptocurrency and using other mechanisms to increase its value.
The lawsuit says that last May the company announced that the distribution of 61.68 billion XRP owned by Ripple will be limited, and promised to transfer 55 billion XRP to the escrow account. Ripple's management, including its CEO, actively advertised this fact to raise the cost of XRP, the plaintiff wrote, adding that they managed to achieve what they wanted.
Ripple CEO Twitter
Ripple’s public commitment to limit the supply of XRP had its intended effect. In the weeks that followed, the price of XRP rapidly increased, from approximately $0.22 per token on December 7, 2017 to $3.38 per token on January 7, 2018.
Lawsuit against Ripple
Thus, this is the third lawsuit filed by Ripple and containing similar charges. Last month, Vladi Zakinov addressed the California court, which claims that XRP is a controlled Ripple security. According to him, Ripple should register XRP before proceeding to sales.
In May, another lawsuit was filed containing similar charges. Its compiler, Ryan Coffey, states that Ripple Labs and other respondents received huge profits from organizing an "never ending initial coin offering", and notes that their statements made investors believe in the future success of the cryptocurrency.
Ripple repeatedly denied the charges. "We absolutely are not a security. We don’t meet the standards for what a security is based on the history of court law, "said Ripple's head of the market strategy, Corey Johnson, in April.