Plaintiff and lead counsel named in Ripple class action lawsuit over XRP offering

Taylor-Copeland Law and Susman Godfrey, LLP were named as co-counsel in a proposed class-action lawsuit against Ripple Labs, Inc. for allegedly failing to comply with securities regulations in the course of their ICO. U.S. District Judge Phyllis J. Hamilton also appointed investor Bradley Sostack as the lead plaintiff.

Filed in May 2018, the lawsuit names Ripple Labs, subsidiary XRP II, and CEO Brad Garlinghouse, among other individuals, as the organizers of an unregistered securities offering.

Plaintiffs filed three separate class action suits against Ripple between June and July 2018 but Sostack was not among them.

Ripple then filed a motion to have the suit moved to the U.S. District Court for the Northern District of California from the Superior Court of the State of California in San Mateo, which the court approved in December 2018.

Judges and juries are locally appointed in lower courts, so corporate defendants like Ripple tend to prefer pleading their case at the federal level.

Early Bitcoin investors threatened by the potential success of Ripple's XRP token offered bribes to members of the Bitcointalk forum to post about Ripple being a scam.

Ripple originally debuted as OpenCoin on the Bitcointalk forum in Feb. 20, 2013, and conducted a series of airdrops to promote the project.

OpenCoin rebranded to Ripple Labs later that year and has since focused on institutional partnership development and fundraising.

In May 2015, the Financial Crimes Enforcement Network fined Ripple $700,000 for failure to comply with anti-money laundering regulations.

"Ripple Labs willfully violated several requirements of the Bank Secrecy Act by acting as a money services business and selling its virtual currency, known as XRP, without registering with FinCEN, and by failing to implement and maintain an adequate anti-money laundering program designed to protect its products from use by money launderers or terrorist financiers."