XRP Lawsuit: Ripple Submits Motion To Dismiss
On Sep 12, 2020
Ripple has been fighting a now year-old lawsuit and recently, a group of investors had filed an amended complaint regarding the same against Ripple. The group had alleged that XRP was an unregistered security under the Securities and Exchange Commission’s (SEC) guidance. However, according to reports, Ripple has now filed a motion to dismiss this lawsuit.
Ripple’s attorneys dismissed the allegations put forth by these XRP investors and claimed that Bradley Sostack, the plaintiff, has no standing to file a complaint. Ripple mentioned that the plaintiff had failed to bring a case within three years of the initial offering, highlighting that the statute of repose had expired, leading to Ripple claiming that the plaintiff did not “plausibly allege” that he purchased XRP during the initial offering and that he did not allege that the defendants sold XRP that he bought.
”Because It Is Not An Investment Contract.”
However, the motion did not contribute to the long-standing argument of XRP’s status as a security or otherwise. The motion only briefly touched upon it in footnote 19 that XRP is not a security “because it is not an investment contract.” It added,
“Purchasing XRP is not an ‘investment’ in Ripple; there is no common enterprise between Ripple and XRP purchasers; there was no promise that Ripple would help generate profits for XRP holders; and the XRP Ledger is decentralized.”
However, the plaintiff has alleged that XRP is a “security” under federal and state law, and that the “defendants have offered and sold XRP, despite its non-registration with securities authorities.”