According to the ruling by District Judge J. Hamilton, the Class Action Lawsuit against Ripple Labs will remain in the Federal court. Lawyer Jake Chervinsky tweeted the good news for Ripple Labs stating that the court’s decision provided a minor but meaningful victory to the defendant- Ripple Labs.
The ruling was based on a previous argument that “[b]ecause interstate class actions typically involve more people, more money, and more interstate commerce ramifications than any other type of lawsuit, the Committee firmly believes that such cases properly belong in federal court.”
A Recap of the Class Action Lawsuit
In the Class Action Lawsuit, the plaintiff accuses Ripple of violating the Securities Act and the California Corporation Code. The plaintiff argues that Ripple’s XRP Tokens are securities in real sense and the fact that they are being sold as tokens and not securities is a violation of the above-mentioned laws.
Taylor-Copeland filed the lawsuit in May 2018 on behalf of Ryan Coffey, a user who purchased 650 XRP tokens and later sold them for USDT only to lose $551.89 upon exchange to US Dollars.
The plaintiff is seeking payment of litigation fees, punitive damages, and the court to declare the sale of XRP an unregistered securities sale.
Ripple Choosing a Favorable Playground
Ripple’s first move was seeking the case to move to the federal court– perhaps a clever strategy to choose a favorable playground.
Now that the first wish has been granted, the company still has to convince the jury beyond reasonable doubt that XRP is tokens and not securities. By extension, clearing the doubt for the entire crypto community who have for a while now questioned the token’s decentralization.
According to the ruling, both parties will have 14 days to plan on how the case will proceed. Upon the expiry of 30 days, the plaintiff shall submit a revised complaint- based on the current ruling after which the litigation will proceed to subsequent stages.
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of journaltranscript.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: https://www.journaltranscript.com/disclaimer