A new class action lawsuit has been filed against Ripple, its CEO Brad Garlinghouse and its subsidiary XRP II, LLC.
Filed in Florida Central District Court on Monday, the case alleges that the defendant sold “millions of dollars (or more)” of XRP without registering it with either federal or Florida authorities.
“On many occasions, Defendants have made public statements claiming that XRP is not a security, when in fact it is,” the lawsuit claims. “Defendants are actively hiding from investors the true nature of XRP.”
The lawsuit was filed by Tyler Toomey, a resident of Florida. Toomey claimed that he owned 135 XRP in November 2022 (worth around $100 at the time) and sold it in two deals in December 2022 for a loss of around 50%.
To be sure, it’s a negligible amount, but since the lawsuit is class-action, another XRP investor with a similar location in Florida could join Toomey in the case. “Plaintiffs seek to represent a class which is defined as any person or entity in the State of Florida that purchases XRP,”
This is not the first time defendants have faced a class action lawsuit. In 2018, investor Vladi Zakinov filed a case in California alleging XRP was a security controlled by Ripple. At the time, another investor Ryan Coffey was also filing a lawsuit in California against the defendants, alleging that XRP was a security.
After years of regulatory uncertainty, last month, the US Securities and Exchange Commission (SEC) also sued Ripple, CEO and co-founder Chris Larsen. The agency said it viewed XRP as a security and alleged that the defendants were involved in the sale of unregistered securities.
Ripple has stated that XRP is not a security and has pledged to fight the SEC’s allegations. Ripple and the SEC will meet for a pretrial conference on February 22. Their joint letter explaining the facts of the case is due on February 15.