- This is a significant defeat for Ripple
- The plaintiffs are now seeking similar approval for investors from other countries
The court in California approved an important decision in Zakinov’s lawsuit against Ripple Labs Inc.. It allows tens of thousands of XRP token holders to file claims against Ripple. And, in the long run, to sue the company for the risks and losses associated with the firm’s allegedly offering unregistered securities.
Remind that in December 2020, the SEC filed a lawsuit against XRP token issuer, Ripple, and its CEO Bradley Garlinghouse. They insist that the $1.38 billion sale of XRP constitutes an illegal offer of unregistered securities. The Ripple payments and money transfer network is based on these tokens.
In the past year, investors filed a separate lawsuit seeking to hold the company accountable. The case initially involved only U.S. buyers of XRP.
Later, lead plaintiff Bradley Sostak asked for the motion to be extended to XRP owners around the world. But at the last hearing, the court responded with a denial:
“Given the evolving legal environment in this area, the court is unwilling to apply California law to a global class of XRP buyers.”
Ripple previously said that the XRP lawsuit decision would have little impact on global operations. 90% of the company’s business is outside the U.S.. Recently, they were approved to work in Singapore.